Q4 Earnings Fail To Impress Transport ETFs

The transportation sector has been affected by the outbreak of coronavirus, which is already turning for the worse into a widespread pandemic. Fourth-quarter earnings hitherto released also don’t paint a rosy picture.

Total earnings accounting for 75% of the sector’s market capitalization have been reported so far. The bottom line is down 8% on no revenue growth. Earnings and revenue beat ratio came in at 50% each as most industry players managed to surpass on either earnings or revenues and a few on both counts.

For a better understanding, let’s delve into the results of some well-known industry players:

Transportation Earnings in Focus

The world's largest package delivery company United Parcel Service (UPS - Free Report) beat on the bottom line but missed on revenues. Earnings of $2.11 were a penny ahead of the consensus mark while the top line of $20.57 billion was marginally below the estimated $20.58 billion. For 2020, the company expects earnings per share in the range of $7.76-$8.06.

Major railroads Union Pacific (UNP - Free Report), Kansas City Southern (KSU - Free Report) and Norfolk Southern Corp (NSC - Free Report) posted a mixed bag. Union Pacific missed on earnings by a penny but beat on revenues by $47 million while Kansas City surpassed on earnings by a penny and missed on revenues by $5 million. Meanwhile, Norfolk Southern’s earnings came in at 26 cents, above the Zacks Consensus Estimate while revenues were on par with the consensus mark.

U.S. airlines Delta Air Lines (DAL - Free Report) and United Continental (UAL - Free Report) delivered better-than-expected results. Earnings per share at Delta and United Continental trumped the Zacks Consensus Estimate by 30 cents and 3 cents, respectively. Revenues of $11.44 billion for Delta and $10.9 billion for United Continental were above the consensus estimate of $11.34 billion and $10.89 billion, respectively. Delta projects earnings per share guidance of $6.75-$7.75 for 2020 while United Continental expects the same in the range of $11-$13.

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