Expeditors International’s Blockbuster 1Q18 Sends Stock up 8%



EXPD: 1Q18 earnings

The United States’ premier road transportation (JBHT) company, Expeditors International of Washington (EXPD), announced its 1Q18 earnings today. The road carrier (IYT) puzzled analysts polled by Thomson Reuters with its strong earnings. EXPD beat analysts’ adjusted EPS (earnings per share) estimate of $0.65 by a wide margin of 17%. The company’s adjusted EPS for 1Q18 came in at $0.76, up a whopping 49% YoY (year-over-year).

Today, EXPD stock opened at $66.0, up 3.2% from yesterday’s closing price of $63.97. The company’s stock rose ~8% in the initial trading hours, touching $70.33. Later, it declined slightly to $69.07.


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EXPD’s 1Q18 revenues and operating stats

The most noteworthy aspect of Expeditor’s 1Q18 results was a solid gross and net revenue rise. The company’s gross revenues grew 20% to $1.8 billion from $1.5 billion in 1Q17. EXPD also beat analysts’ 1Q18 revenue estimate of $1.7 billion by 8%. 5% growth in both airfreight tonnage volume and ocean container volume (CHRW), along with strong pricing gains, boosted the company’s 1Q18 top line.

EXPD’s net revenues, which represent the company’s primary operational and financial measure, jumped 21% to $635.8 million in 1Q18, compared with $527.6 million in 1Q17. Operating profit exhibited robust 32% growth from $146.1 million in 2017 to $192.8 million in this year’s first quarter. Net earnings attributable to shareholders soared 45% to $135.6 million in 1Q18 from $93.2 million last year.

In March 2018, Expeditors International announced a cloud-based platform with Walmart (WMT) known as Expeditors Carrier Allocation. This platform predicts, plans, and links forwarders and shippers with ocean carriers before shipping to decide the most optimal product flow. The company expects this platform to grow revenues in 2018.

Management outlook for 2018

Expeditor International’s CEO Jeffery Musser stated, “Compared with the robust volume growth in the first quarter a year ago. This quarter’s volume increases and financial performance track more in line with our historical performance and demonstrates our ability to execute and generate profitable growth. Demand has remained strong and we have continued to invest in people, processes and technology to efficiently handle the increased volumes across all products.”


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