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Bullish 2022 Guidance Aids Werner (WERN) Amid High Debt
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We have recently updated a report on Werner Enterprises, Inc. (WERN - Free Report) .
We are encouraged by Werner’s bullish guidance for full-year 2022. The company expects TTS truck growth of 2-5% year over year in 2022. Under the TTS guidance, the company estimates Dedicated revenue per truck per week to increase 3-5% in 2022, owing to expectations of strong rates. One-way Truckload revenues per total mile are predicted to increase 16-19% in the first half of 2022 from the comparable period in 2021. The upside can be attributed to increased contractual rates and higher spot rates as well as fleet mix changes.
Werner is gradually recovering from the coronavirus-induced slump, thanks to improving freight market conditions in the United States. Revenues in the Logistics segment and Truckload Transportation Services segment revenues increased 32% and 11%, respectively, year over year in 2021. While Werner Logistics segment benefited from a rise in intermodal and truckload logistics volume, Werner’s Truckload Transportation Services segment benefited from an increase in fuel surcharge revenues.
Werner exited the December quarter with cash and cash equivalents of $54.2 million, way below the long-term debt (net of current portion) of $422.5 million. This implies that the company does not have enough cash to meet its debt levels.
Zacks Rank & Stocks to Consider
Werner currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Transportation sector are Expeditors International of Washington, Inc. (EXPD - Free Report) , Old Dominion Freight Line, Inc. (ODFL - Free Report) and Triton International Limited .
Expeditors has an earnings surprise of 34.2%, having surpassed the Zacks Consensus Estimate in all of the past four quarters. Expeditors is being aided by the uptick in airfreight revenues. We are optimistic about the company’s buyout of Fleet Logistics’ Digital Platform. The acquisition has boosted Expeditors’ online LTL shipping platform, Koho. The move is in line with the company’s focus on Digital Solutions.
The long-term expected EPS (three to five years) growth rate for Old Dominion is pegged at 16%. Old Dominion is benefiting from the strong performance of the LTL segment owing to improved freight conditions. In 2021, revenues from the LTL services segment increased 30.7% on a year-over-year basis.
Driven by the tailwinds, the stock has increased 32% in the past year. ODFL currently carries a Zacks Rank #2 (Buy).
The long-term expected EPS (three to five years) growth rate for Triton is pegged at 10%. Gradual increases in trade volumes and container demand bode well for the company. With easing coronavirus-led restrictions in the United States and Europe, the company saw a strong rebound in its business in the third, the fourth of 2020 as well as in each of the four quarters of 2021.
Driven by the tailwinds, the stock has increased 8.4% in the past year. TRTN currently carries a Zacks Rank #2.
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Bullish 2022 Guidance Aids Werner (WERN) Amid High Debt
We have recently updated a report on Werner Enterprises, Inc. (WERN - Free Report) .
We are encouraged by Werner’s bullish guidance for full-year 2022. The company expects TTS truck growth of 2-5% year over year in 2022. Under the TTS guidance, the company estimates Dedicated revenue per truck per week to increase 3-5% in 2022, owing to expectations of strong rates. One-way Truckload revenues per total mile are predicted to increase 16-19% in the first half of 2022 from the comparable period in 2021. The upside can be attributed to increased contractual rates and higher spot rates as well as fleet mix changes.
Werner is gradually recovering from the coronavirus-induced slump, thanks to improving freight market conditions in the United States. Revenues in the Logistics segment and Truckload Transportation Services segment revenues increased 32% and 11%, respectively, year over year in 2021. While Werner Logistics segment benefited from a rise in intermodal and truckload logistics volume, Werner’s Truckload Transportation Services segment benefited from an increase in fuel surcharge revenues.
Werner exited the December quarter with cash and cash equivalents of $54.2 million, way below the long-term debt (net of current portion) of $422.5 million. This implies that the company does not have enough cash to meet its debt levels.
Zacks Rank & Stocks to Consider
Werner currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Transportation sector are Expeditors International of Washington, Inc. (EXPD - Free Report) , Old Dominion Freight Line, Inc. (ODFL - Free Report) and Triton International Limited .
Expeditors has an earnings surprise of 34.2%, having surpassed the Zacks Consensus Estimate in all of the past four quarters. Expeditors is being aided by the uptick in airfreight revenues. We are optimistic about the company’s buyout of Fleet Logistics’ Digital Platform. The acquisition has boosted Expeditors’ online LTL shipping platform, Koho. The move is in line with the company’s focus on Digital Solutions.
EXPD currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The long-term expected EPS (three to five years) growth rate for Old Dominion is pegged at 16%. Old Dominion is benefiting from the strong performance of the LTL segment owing to improved freight conditions. In 2021, revenues from the LTL services segment increased 30.7% on a year-over-year basis.
Driven by the tailwinds, the stock has increased 32% in the past year. ODFL currently carries a Zacks Rank #2 (Buy).
The long-term expected EPS (three to five years) growth rate for Triton is pegged at 10%. Gradual increases in trade volumes and container demand bode well for the company. With easing coronavirus-led restrictions in the United States and Europe, the company saw a strong rebound in its business in the third, the fourth of 2020 as well as in each of the four quarters of 2021.
Driven by the tailwinds, the stock has increased 8.4% in the past year. TRTN currently carries a Zacks Rank #2.