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Expeditors (EXPD) to Post Q1 Earnings: What's in the Offing?

Zacks Equity Research
·4 min read

Expeditors International of Washington, Inc. EXPD is scheduled to report first-quarter 2020 results on May 5.

The Zacks Consensus Estimate for first-quarter earnings has been revised approximately 5.5% downward to 68 cents in the past 60 days.

Let’s take a look at the factors that might have impacted the company’s quarterly performance.

Factors at Play

With the outbreak of COVID-19 pandemic, the company expects its first-quarter 2020 performance to have been negatively impacted by this adversity. The extended closure of factories in China due to the virus outbreak might have dented freight volumes and increased supply disruptions throughout the March end quarter. Low shipment volumes are likely to get reflected on revenues in Airfreight Services, its primary unit, as well as on air freight revenues. Evidently, the Zacks Consensus Estimate for Airfreight Services revenues indicates 8.6% decline from the December end quarter’s reported figure.

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While increased ocean freight container volumes are likely to have boosted revenues in the Ocean Freight and Ocean Services unit, the company’s declining customs brokerage and import services are expected to have had a negative impact on revenues in the Customs Brokerage and Other Services division due to the pandemic.

Expeditors International of Washington, Inc. Price and EPS Surprise

 

Expeditors International of Washington, Inc. Price and EPS Surprise
Expeditors International of Washington, Inc. Price and EPS Surprise

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

 

What do the Estimates Indicate?

Notably, the Zacks Consensus Estimate for Ocean Freight and Ocean Services revenues suggests 7.1% rise from fourth-quarter 2019 revenues. The same for Customs Brokerage and Other Services revenues indicates a marginal decline from the December end quarter’s reported figure.

The consensus mark for Airfreight Services revenues indicates a decline of 3.8% from the year-ago quarter’s reported quarter. Global supply chains are likely to have been disrupted due to shortages of raw materials, parts and supplies. Evidently, the Zacks Consensus Estimate for current quarter revenues is pegged at 1.90 billion, which indicates year-over-year fall of of 5.8%.

What Does the Zacks Model Say?

Our proven model does not predict an earnings beat for Expeditors this time around. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP:  Expeditors has an Earnings ESP of -5.93% since the Most Accurate Estimate is pegged at 64 cents, lower than the Zacks Consensus Estimate of 68 cents. 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 Q4 Earnings

In the last reported quarter, Expeditors’ earnings per share came in at 81 cents per share that beat the Zacks Consensus Estimate by a penny. Moreover, quarterly earnings declined 20.6% on a year-over-year basis. Quarterly revenues of $2.04 billion missed the consensus mark of $2.19 billion and declined 9% on a year-over-year basis.

Stocks to Consider

Investors interested in the Zacks Transportation sector may consider Golar LNG Limited GLNG, JetBlue Airways Corporation JBLUand Hawaiian Holdings, Inc. HA as these stocks have the right combination of elements to beat on earnings in this reporting cycle.

Golar LNG has an Earnings ESP of +1000.09% and a Zacks Rank #2.

JetBlue has an Earnings ESP of +0.41% and a Zacks Rank #3. The company will report first-quarter 2020 earnings on May 7.

Hawaiian Holdings has an Earnings ESP of +15.21% and a Zacks Rank #3. The company will report first-quarter 2020 earnings on May 5.

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JetBlue Airways Corporation (JBLU) : Free Stock Analysis Report
 
Expeditors International of Washington, Inc. (EXPD) : Free Stock Analysis Report
 
Hawaiian Holdings, Inc. (HA) : Free Stock Analysis Report
 
Golar LNG Limited (GLNG) : Free Stock Analysis Report
 
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