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Notably, consistent shareholder-friendly initiatives in the form of dividend payouts or share buybacks imply solid financial strength of companies in the Equipment and Leasing industry. Dividend-paying stocks provide a solid income stream and have fewer chances of experiencing wild price swings. These stocks are safe bets for creating wealth, as the payouts generally act as a hedge against economic uncertainty like the current scenario.
To name a few, on Nov 3, 2023, Air Lease Corporation’s (AL - Free Report) board of directors increased its quarterly cash dividend by 5%, from 20 cents per share to 21 cents. The raised quarterly dividend of 21 cents per share will be paid on Jan 10, 2024, to shareholders of record as of Dec 15, 2023.
Further, AL has an expected earnings growth rate of more than 100% for the current year. AL delivered a trailing four-quarter earnings surprise of 6%, on average.
In July 2023, Ryder System, Inc. (R - Free Report) announced a 14.5% hike in its quarterly dividend, taking the total to 71 cents per share (annualized $2.84), which gives it a 2.67% yield at the current stock price. This company’s payout ratio is 20%, with a five-year dividend growth rate of 3.96%.
Ryder is also active on the buyback front. In February 2023, R’s board approved a new 2-million share discretionary repurchase program. The management is now authorized to buyback up to 2 million shares of common stock at its discretion from Feb 10, 2023, through Feb 10, 2025 (two years).
Meanwhile, the successful execution of Ryder's strategic, operational and financial plan drives the bright earnings outlook for 2023. Adjusted EPS for the year is now estimated to be between $12.60 and $12.85 (prior view: $12.20 and $12.70). R has delivered a trailing four-quarter earnings surprise of 7.62%, on average.
GATX Corporation (GATX - Free Report) , which has been paying regular dividends since 1919, holds an impressive record with respect to dividends and buybacks. In January 2023, GATX raised its quarterly dividend by 5.8% to 55 cents per share. Its commitment to reward shareholders despite coronavirus-related disruptions is encouraging. Notably, 2023 marks the 105th consecutive year of GATX paying out dividends. GATX pays out a quarterly dividend of 55 cents ($2.20 annualized) per share, which gives it a 2.03% yield at the current stock price. This company’s payout ratio is 32%, with a five-year dividend growth rate of 4.46%. (Check GATX’s dividend history here).
GATX has an encouraging track record with respect to earnings surprise, having surpassed the Zacks Consensus Estimate in three of the past four quarters. The average beat is 16.49%. GATX has an expected earnings growth rate of 14.17% for the current year.
Currently, AL, R and GATX carry a Zacks Rank #3 (Hold).
Westinghouse Air Brake Technologies Corporation, operating as Wabtec Corporation (WAB - Free Report) , repurchased shares worth $252 million and paid $92 million in the form of dividend payments during the first nine months of 2023. WAB pays out a quarterly dividend of 17 cents ($0.68 annualized) per share, which gives it a 0.58% yield at the current stock price. This company’s payout ratio is 12%, with a five-year dividend growth rate of 8.36%. (Check WAB’s dividend history here).
WAB has an expected earnings growth rate of 22.02% for the current year. WAB delivered a trailing four-quarter earnings surprise of 7.11%, on average. The Zacks Consensus Estimate for WAB’s 2023 earnings has improved 5.1% over the past 90 days.
Improved guidance for 2023 looks encouraging and raises optimism about this stock. For 2023, it now expects sales of $9.50-$9.70 billion (prior view: $9.25-$9.50 billion). Adjusted earnings per share are now estimated to be between $5.80 and $6.00 (prior view: $5.50 and $5.80). Management still anticipates strong cash flow generation, with operating cash flow conversion exceeding 90%. WAB currently holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We believe such shareholder-friendly initiatives should boost investor confidence and positively impact the bottom line. Notably, the industry has gained 17.6% over the past six months, outperforming the S&P 500 Index’s northward movement of 8% and a 2.2% rise in the Zacks Transportation sector.
Image Source: Zacks Investment Research
Despite such positives, the industry continues to grapple with challenges, ranging from raging inflation, higher interest rates, supply-chain disruptions and high operating costs.
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Equipment & Leasing Industry Up 17.6% in 6 Months: Here's Why
The Zacks Transportation - Equipment and Leasing industry currently stands to benefit from the solid investor-friendly steps.
Notably, consistent shareholder-friendly initiatives in the form of dividend payouts or share buybacks imply solid financial strength of companies in the Equipment and Leasing industry. Dividend-paying stocks provide a solid income stream and have fewer chances of experiencing wild price swings. These stocks are safe bets for creating wealth, as the payouts generally act as a hedge against economic uncertainty like the current scenario.
To name a few, on Nov 3, 2023, Air Lease Corporation’s (AL - Free Report) board of directors increased its quarterly cash dividend by 5%, from 20 cents per share to 21 cents. The raised quarterly dividend of 21 cents per share will be paid on Jan 10, 2024, to shareholders of record as of Dec 15, 2023.
Further, AL has an expected earnings growth rate of more than 100% for the current year. AL delivered a trailing four-quarter earnings surprise of 6%, on average.
In July 2023, Ryder System, Inc. (R - Free Report) announced a 14.5% hike in its quarterly dividend, taking the total to 71 cents per share (annualized $2.84), which gives it a 2.67% yield at the current stock price. This company’s payout ratio is 20%, with a five-year dividend growth rate of 3.96%.
Ryder is also active on the buyback front. In February 2023, R’s board approved a new 2-million share discretionary repurchase program. The management is now authorized to buyback up to 2 million shares of common stock at its discretion from Feb 10, 2023, through Feb 10, 2025 (two years).
Meanwhile, the successful execution of Ryder's strategic, operational and financial plan drives the bright earnings outlook for 2023. Adjusted EPS for the year is now estimated to be between $12.60 and $12.85 (prior view: $12.20 and $12.70). R has delivered a trailing four-quarter earnings surprise of 7.62%, on average.
GATX Corporation (GATX - Free Report) , which has been paying regular dividends since 1919, holds an impressive record with respect to dividends and buybacks. In January 2023, GATX raised its quarterly dividend by 5.8% to 55 cents per share. Its commitment to reward shareholders despite coronavirus-related disruptions is encouraging. Notably, 2023 marks the 105th consecutive year of GATX paying out dividends. GATX pays out a quarterly dividend of 55 cents ($2.20 annualized) per share, which gives it a 2.03% yield at the current stock price. This company’s payout ratio is 32%, with a five-year dividend growth rate of 4.46%. (Check GATX’s dividend history here).
GATX has an encouraging track record with respect to earnings surprise, having surpassed the Zacks Consensus Estimate in three of the past four quarters. The average beat is 16.49%. GATX has an expected earnings growth rate of 14.17% for the current year.
Currently, AL, R and GATX carry a Zacks Rank #3 (Hold).
Westinghouse Air Brake Technologies Corporation, operating as Wabtec Corporation (WAB - Free Report) , repurchased shares worth $252 million and paid $92 million in the form of dividend payments during the first nine months of 2023. WAB pays out a quarterly dividend of 17 cents ($0.68 annualized) per share, which gives it a 0.58% yield at the current stock price. This company’s payout ratio is 12%, with a five-year dividend growth rate of 8.36%. (Check WAB’s dividend history here).
WAB has an expected earnings growth rate of 22.02% for the current year. WAB delivered a trailing four-quarter earnings surprise of 7.11%, on average. The Zacks Consensus Estimate for WAB’s 2023 earnings has improved 5.1% over the past 90 days.
Improved guidance for 2023 looks encouraging and raises optimism about this stock. For 2023, it now expects sales of $9.50-$9.70 billion (prior view: $9.25-$9.50 billion). Adjusted earnings per share are now estimated to be between $5.80 and $6.00 (prior view: $5.50 and $5.80). Management still anticipates strong cash flow generation, with operating cash flow conversion exceeding 90%. WAB currently holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We believe such shareholder-friendly initiatives should boost investor confidence and positively impact the bottom line. Notably, the industry has gained 17.6% over the past six months, outperforming the S&P 500 Index’s northward movement of 8% and a 2.2% rise in the Zacks Transportation sector.
Image Source: Zacks Investment Research
Despite such positives, the industry continues to grapple with challenges, ranging from raging inflation, higher interest rates, supply-chain disruptions and high operating costs.