Expeditors (EXPD) to Post Q2 Earnings: What's in the Offing?

Expeditors International of Washington EXPD is scheduled to report second-quarter 2020 results on Aug 4.

The company has an impressive record with respect to earnings per share. Its bottom line outshined the Zacks Consensus Estimate in each of the last four quarters, the average being 4.5%.

Expeditors International of Washington, Inc. Price and EPS Surprise

Expeditors International of Washington, Inc. price-eps-surprise | Expeditors International of Washington, Inc. Quote

Moreover, the Zacks Consensus Estimate for second-quarter earnings has remained stable at 66 cents in the past 60 days.

Against this backdrop, let’s take a look at the factors that might have impacted the company’s June-quarter performance.

The impact of coronavirus-induced supply-chain disruptions is expected to have been more severe in the June quarter than it was in the March quarter. This is because the entire second quarter (April-June months) bore the brunt of this unprecedented crisis as opposed to only a single month in the last reported quarter.

Low shipment volumes are likely to get reflected in revenue results at Airfreight Services, its primary unit. Evidently, the Zacks Consensus Estimate for Airfreight Services revenues indicates a 16.5% decline from the sequential quarter’s reported figure.

Although the Zacks Consensus Estimate for Ocean Freight and Ocean Services revenues suggests a marginal rise from the number reported sequentially, the same for Customs Brokerage and Other Services revenues implies a 2.4% dip from the March quarter’s reported figure. However, low fuel costs are likely to have aided the bottom line.

What Does the Zacks Model Say?

The proven Zacks model predicts an earnings beat for Expeditors this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Expeditors has an Earnings ESP of +6.87% as the Most Accurate Estimate is pegged at 70 cents, 4 cents above the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Expeditors carries a Zacks Rank #3, currently.

Highlights of Q1 Earnings

Expeditors' earnings of 71 cents per share surpassed the Zacks Consensus Estimate by 3 cents. However, the bottom line decreased 11.3% on a year-over-year basis. Further, total revenues of $1,901.9 marginally missed the Zacks Consensus Estimate of $1,902.7 and also declined 5.9% year over year.

Other Stocks to Consider

Investors interested in the broader Transportation sector may check out a few other stocks worth considering like Allegiant Travel Company ALGT, Atlas Air Worldwide Holdings AAWW and Copa Holdings CPA as these too possess the perfect combination of elements to beat estimates this earnings season.

Allegiant Travel has an Earnings ESP of +23.25% and a Zacks Rank of 3, currently. This company is set to release second-quarter financial numbers on Jul 29.

Atlas Air presently has an Earnings ESP of +19.81% and is a #2 Ranked player. The company will release second-quarter 2020 results on Aug 6.

Copa Holdings has an Earnings ESP of +19.18% and is Zacks #3 Ranked at present. The company will release second-quarter 2020 results on Aug 5.

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