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Here's Why You Should Give Knight-Swift Stock a Miss Now
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Knight-Swift Transportation Holdings Inc. (KNX - Free Report) is currently mired in multiple headwinds, which, we believe, have made it an unimpressive investment option.
Let’s delve deeper.
Southward Earnings Estimate Revision:The Zacks Consensus Estimate for third-quarter 2024 earnings has been revised 10.2% downward over the past 90 days. For 2024, the consensus mark for earnings has moved 13.4% south in the same time frame. The bearish alterations in estimate revisions underscore a notable decline in brokers' confidence in the stock.
Weak Zacks Rank and Style Score: Knight-Swift currently carries a Zacks Rank #5 (Strong Sell). The company’s current Value Score of C shows its unattractiveness.
Unimpressive Price Performance: KNX has declined 8.8% over the past year compared with the industry’s loss of 4%.
YTD Price Comparison
Image Source: Zacks Investment Research
Negative Earnings Surprise History: KNX has a disappointing earnings surprise history. The company’s earnings lagged the Zacks Consensus Estimate in three of the last four quarters (outpaced the mark in the remaining quarter), delivering an average miss of 30.92%.
Earnings Expectations: Downbeat earnings expectations cast a shadow over a company’s prospects. For third-quarter 2024, KNX’s earnings are expected to decline 14.63% year over year. For 2024, KNX’s earnings are expected to decline 36.05% year over year. For 2025, KNX’s earnings are expected to decrease more than 100% year over year.
Other Headwinds: High costs related to driver wages, equipment, maintenance, fuel and other expenses are restricting Knight-Swift’s bottom-line growth. During the first half of 2024, salaries, wages and benefits expenses rose 29.4% year over year, while operations and maintenance expenses climbed 35.9% year over year. Total operating expenses increased 21.5% year over year to $3.58 billion in the first half of 2024.
KNX’s financial metrics indicate that its leverage is elevated and is a massive negative for its shareholders. KNX’s second-quarter 2024 long-term debt translates into a debt-to-capitalization of 19.6%, which is lower than the sub-industry’s 25.8%.
CHRW has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters (missed the mark in the remaining quarter), delivering an average surprise of 7.33%.
CHRW has an expected earnings growth rate of 22.42% for 2024. The Zacks Consensus Estimate for CHRW’s 2024 earnings has been revised 11.3% upward over the past 90 days. Shares of CHRW have gained 14.3% so far this year.
WAB has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters (missed the mark in the remaining quarter), delivering an average surprise of 11.83%.
The Zacks Consensus Estimate for WAB’s 2024 earnings has been revised 3.3% upward over the past 90 days. WAB has an expected earnings growth rate of 25.34% for 2024. Shares of WAB have gained 23.5% so far this year.
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Here's Why You Should Give Knight-Swift Stock a Miss Now
Knight-Swift Transportation Holdings Inc. (KNX - Free Report) is currently mired in multiple headwinds, which, we believe, have made it an unimpressive investment option.
Let’s delve deeper.
Southward Earnings Estimate Revision:The Zacks Consensus Estimate for third-quarter 2024 earnings has been revised 10.2% downward over the past 90 days. For 2024, the consensus mark for earnings has moved 13.4% south in the same time frame. The bearish alterations in estimate revisions underscore a notable decline in brokers' confidence in the stock.
Weak Zacks Rank and Style Score: Knight-Swift currently carries a Zacks Rank #5 (Strong Sell). The company’s current Value Score of C shows its unattractiveness.
Unimpressive Price Performance: KNX has declined 8.8% over the past year compared with the industry’s loss of 4%.
YTD Price Comparison
Negative Earnings Surprise History: KNX has a disappointing earnings surprise history. The company’s earnings lagged the Zacks Consensus Estimate in three of the last four quarters (outpaced the mark in the remaining quarter), delivering an average miss of 30.92%.
Earnings Expectations: Downbeat earnings expectations cast a shadow over a company’s prospects. For third-quarter 2024, KNX’s earnings are expected to decline 14.63% year over year. For 2024, KNX’s earnings are expected to decline 36.05% year over year. For 2025, KNX’s earnings are expected to decrease more than 100% year over year.
Other Headwinds: High costs related to driver wages, equipment, maintenance, fuel and other expenses are restricting Knight-Swift’s bottom-line growth. During the first half of 2024, salaries, wages and benefits expenses rose 29.4% year over year, while operations and maintenance expenses climbed 35.9% year over year. Total operating expenses increased 21.5% year over year to $3.58 billion in the first half of 2024.
KNX’s financial metrics indicate that its leverage is elevated and is a massive negative for its shareholders. KNX’s second-quarter 2024 long-term debt translates into a debt-to-capitalization of 19.6%, which is lower than the sub-industry’s 25.8%.
Stocks to Consider
Some better-ranked stocks from the Zacks Transportation sector are C.H. Robinson Worldwide (CHRW - Free Report) and Wabtec Corporation (WAB - Free Report) . Each stock presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
CHRW has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters (missed the mark in the remaining quarter), delivering an average surprise of 7.33%.
CHRW has an expected earnings growth rate of 22.42% for 2024. The Zacks Consensus Estimate for CHRW’s 2024 earnings has been revised 11.3% upward over the past 90 days. Shares of CHRW have gained 14.3% so far this year.
WAB has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters (missed the mark in the remaining quarter), delivering an average surprise of 11.83%.
The Zacks Consensus Estimate for WAB’s 2024 earnings has been revised 3.3% upward over the past 90 days. WAB has an expected earnings growth rate of 25.34% for 2024. Shares of WAB have gained 23.5% so far this year.