Shares of **Ryder System, Inc.** R reached a 52-week high of $104.21 in the trading session on Sep 18, 2023, before closing slightly lower at $103.43.
The company’s shares have gained 23.8% so far this year, outperforming the 7.7% rise of the [transportation equipment and leasing industry](https://www.zacks.com/stocks/industry-rank/industry/transportation-equipment-and-leasing-188) it belongs to.
Image Source: Zacks Investment Research
Let’s find out the factors supporting this upward movement.
Ryder’s 2023 outlook is encouraging. Following its second-quarter 2023 results, the management raised its earnings per share (EPS) outlook for the year. This revision is driven by the successful execution of its strategic, operational, and financial plan. The adjusted EPS for 2023 is now projected to be between $12.20 and $12.70 (previously $11.30-$12.05).
For 2023, the management expects operating revenues to increase by 2%. The projected net cash from operating activities is $2.5 billion (previously $2.4 billion). The adjusted return on equity (ROE) is estimated to be in the range of 17-19% (previously 16-18%).
Ryder’s efforts to reward its shareholders through dividends and share buybacks are also appreciated. In July 2023, the company announced a 14.5% increase in its quarterly dividend, bringing the total to 71 cents per share ($2.84 annualized). Ryder is also actively buying back its shares. In February 2023, the board approved a new discretionary repurchase program allowing the management to buyback up to 2 million shares of common stock at its discretion from Feb 10, 2023, through Feb 10, 2025 (two years).
The positive sentiment surrounding the stock is evident from the upward revision of the Zacks Consensus Estimate for current-year earnings over the past 60 days.
Zacks Rank and Other Stocks to Consider
Currently, Ryder holds a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks from the [Transportation sector](https://www.zacks.com/stocks/industry-rank/sector/transportation-15) are **GATX Corporation (GATX)** and **SkyWest, Inc. (SKYW)**. Both companies currently carry a Zacks Rank of 2 (Buy). You can see [the complete list of today’s Zacks #1 Rank stocks here](https://www.zacks.com/stocks/buy-list/?ADID=zp_1link&ICID=zpi%20_1link).
GATX is expected to achieve an earnings growth rate of 14.33% for the current year. It has delivered an average trailing four-quarter earnings surprise of 17.30%.
The Zacks Consensus Estimate for GATX’s current-year earnings has improved by 2.1% over the past 90 days. GATX’s shares have gained 6% year to date.
SkyWest’s fleet-modernization efforts are commendable. A decline in operating expenses is a positive factor for SkyWest. In the second quarter of 2023, the operating expenses decreased by 2.4% to $693.8 million due to a reduction in operating costs. Lower operating expenses contribute to improved bottom-line results. SkyWest’s shares have surged 163.6% year to date.
SkyWest has delivered an average trailing four-quarter earnings surprise of 31.51%.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
