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Ryder (R) Expands Fleet Management With Metro Truck Buyout

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Ryder System, Inc. (R - Free Report) recently completed the acquisition of Metro Truck & Tractor Leasing (Metro), a company with a fleet of approximate 900 units, providing truck leasing, rental and maintenance services to more than 150 customers.

Following the buyout, Ryder will now operate two of Metro’s Maryland facilities in Beltsville and Baltimore. Per the agreement, the company bought mobile maintenance vehicles to provide maintenance services to customers located in and around Baltimore and Washington, D.C. Ryder Mobile Maintenance is a fleet management solution technique wherein fully-equipped vehicles reach a customer’s location, providing tailor-made maintenance facilities to ensure fleet uptime.

The transaction allows Ryder to expand its footprint in the Baltimore Metro Area where demand for fleet management services is increasingly high.

The acquisition is anticipated to be marginally accretive to the company’s earnings in the current year. Also, banking on synergies and operational enhancements within the combined entity besides growth opportunities with Metro’s existing customers and prospects  in the Maryland area, the company expects further improvement in its bottom line in the coming years.

 

We remind investors that in April, Ryder closed the acquisition of MXD Group for $120 million. Per the agreement, the company acquired 109 MXD e-commerce fulfillment facilities across the United States and Canada. It also obtained 21 MXD-operated cross dock hubs, 16 dedicated operations and a network of 72 third-party agent facilities. (Read more: Ryder Boosts E-Commerce Portfolio With MXD Group Buyout)

These two acquisitions in a very short span of time indicate the company’s commitment to widen its worldwide operations for improving customer service.

Zacks Rank & Key Picks

Ryder carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Transportation sector are GATX Corporation (GATX - Free Report) , SkyWest, Inc. (SKYW - Free Report) and Expeditors International of Washington, Inc. (EXPD - Free Report) .  While GATX and SkyWest hold a Zacks Rank #2 (Buy), Expeditors sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past six months, shares of GATX and Expeditors have rallied more than 18% each while SkyWest stock has risen above 9%.

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