Triton International Limited (TRTN), a shipping container leasing company, just recently reported fantastic third quarter results. Triton is a great under-the-radar stock. For Q3, earnings per share (EPS) of $1.14 beat estimates by $0.08. Revenue fell 2.6% year over year (YoY) to $327.8 million, slightly missing expectations of $336.15.

Management raised guidance for Q4 and sees EPS growing an incredible 25%, to $1.43 vs. estimates of $1.21. The company raised guidance going forward and increased its dividend by nearly 10%.

Management explained trade volumes have rebounded sharply, creating a shortage of containers. This is simple supply and demand. As demand for shipping increases, combined with a shortage of containers, the price to ship goods moves higher, allowing TRTN to reap the benefits.

TRTN expects the shortage in container ships to last at least into Q1 2021. It raised its quarterly dividend nearly 10% to $0.57, up from $0.52. At current prices, TRTN pays a dividend of over 5%,  more than double the average S&P 500 dividend.

The S&P is trading at a forward (next 12 months) price-to-earnings ratio of over 20x. Triton is trading with a forward P/E of less than 10x  and growing earnings much faster than the market.

My thesis behind this investment is alive and well. Global shipping is recovering faster than anticipated after the coronavirus lockdowns, and the company is in a perfect spot to capitalize from the shortage in container ships.

We first added Triton International Limited to our model portfolio back in May. Take this opportunity to build a full position right away. I'm also raising the buy-up-to price to $41.50.