Ryder Falls Short of Q4 Sales Targets, but Surpasses Profit Estimates

Ryder System, Inc. (NYSE: R), a leader in commercial rental vehicles and delivery services, reported mixed financial results for the fourth quarter of fiscal 2024 (Q4 CY2024).

Q4 CY2024 Highlights:

* Revenue: $3.19 billion (5.5% YoY growth, 1.5% below analyst estimates)
* Adjusted Earnings Per Share (EPS): $3.45 (2.3% beat; 3.37 consensus)
* Adjusted EBITDA: $720 million (5.9% miss; $765 million consensus)
* Free Cash Flow: -$85 million (improvement from -$266 million in Q4 CY2023)
* Adjusted EPS Guidance for FY2025: $13.50 midpoint (in line with estimates)

Key Observations:

* Despite revenue shortfall, Ryder grew sales by 5.5% year-on-year.
* Operating margin improved to 8.7%, up from 6% in Q4 CY2023.
* Supply Chain Solutions revenue grew by 6.1% over the last two years.
* Earnings per share (EPS) grew at a 64.1% compounded annual rate over the last five years.

Industry and Thematic Considerations:

* E-commerce and global trade continue to drive demand for ground transportation services.
* Companies are investing in data analytics and autonomous fleets to optimize efficiency.
* Ground transportation companies are subject to economic cycles and fuel cost influences.

Is Ryder a Buy?

Ryder's mixed results present a balanced investment opportunity. Here are some key factors to consider:

* Valuation: The company's market capitalization is approximately $6.69 billion.
* Business Qualities: Ryder has a long-term track record of growth, efficiency improvements, and profitability.
* Earnings Prospects: Sell-side analysts expect revenue growth of 6.3% over the next 12 months and full-year EPS growth of 12.7%.

For a more comprehensive analysis of Ryder's financial performance, business outlook, and investment potential, please refer to our full research report.