A month has gone by since the last earnings report for Ryder (R Quick QuoteR - Free Report) . Shares have lost about 12.7% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Ryder due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Ryder Beats Q4 Earnings Estimates

Ryder reported better-than-expected fourth-quarter 2022 results, wherein earnings and revenues outperformed the Zacks Consensus Estimate.

Quarterly earnings of $3.89 per share surpassed the Zacks Consensus Estimate of $3.60. The bottom line increased 10.5% year over year on the back of higher revenues.

Total revenues of $3,088 million also outperformed the Zacks Consensus Estimate of $2,971.7 million. The top line increased 18.7% year over year on strong segmental performances.

Segmental Result

Fleet Management Solutions: Total revenues of $1,595 million were up 6% year over year. Operating revenues summed $1,321 million, up 2% year over year. Segmental revenues benefited from higher rental revenue driven by strong demand and higher pricing. Revenues also increased on higher fuel pricing.

Supply-Chain Solutions: Total revenues in the segment were $1,251 million, up 44% year over year. Operating revenues rose 44% year over year to $883 million on the back of contributions from acquisitions and double-digit revenue growth in all industry verticals from new business, higher volumes and increased pricing.

Dedicated Transportation Solutions: Total revenues amounted to $456 million, up 13% from the year-ago quarter’s figure. Operating revenues climbed 10% to $320 million. The revenue uptick was driven byhigher pricing and volumes.

Liquidity

Ryder exited the fourth quarter with cash and cash equivalents of $267 million compared with $456.3 million at the end of September 2022. R’s total debt (including the current portion) came in at $1,967million at the end of the fourth quarter compared with $6,334.1reported at the end of September 2022. 

During the fourth quarter, Ryder repurchased 2 million shares for $179 million under its completed 2021 Discretionary program. Additionally, the company repurchased 0.9 million shares for $78 million under its 2021 Anti-Dilutive program. In February 2023, Ryder’s board approved a new 2-million-share discretionary repurchase program.

Outlook

For the first quarter of 2023, Ryder expects its adjusted earnings per share to be in the range of $2.75-$3.00.

For 2023, Ryder expects total revenues and operating revenues to increase approximately 2% and 4%, respectively. Adjusted EPS for the whole year is estimated to be in the range of $11.05-$12.05.

R expects a free cash flow of almost $200 million in 2023.  Net cash from operating activities is expected to be around $2.4 billion. Adjusted ROE (return on investment) is expected to be 16-18%. Capital expenditures are estimated to be around $3 billion.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

The consensus estimate has shifted 5.71% due to these changes.

VGM Scores

At this time, Ryder has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Ryder has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.