The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Werner (NASDAQ:WERN) and the rest of the ground transportation stocks fared in Q2.

The growth of e-commerce and global trade continues to drive demand for shipping services, especially last-mile delivery, presenting opportunities for ground transportation companies. The industry continues to invest in data, analytics, and autonomous fleets to optimize efficiency and find the most cost-effective routes. Despite the essential services this industry provides, ground transportation companies are still at the whim of economic cycles. Consumer spending, for example, can greatly impact the demand for these companies’ offerings while fuel costs can influence profit margins.

The 16 ground transportation stocks we track reported a slower Q2. As a group, revenues missed analysts’ consensus estimates by 1%.

After much suspense, the Federal Reserve cut its policy rate by 50bps (half a percent) in September 2024. This marks the central bank’s first easing of monetary policy since 2020 and the end of its most pointed inflation-busting campaign since the 1980s. Inflation had begun to run hot in 2021 post-COVID due to a confluence of factors such as supply chain disruptions, labor shortages, and stimulus spending. While CPI (inflation) readings have been supportive lately, employment measures have prompted some concern. Going forward, the markets will debate whether this rate cut (and more potential ones in 2024 and 2025) is perfect timing to support the economy or a bit too late for a macro that has already cooled too much.

While some ground transportation stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.1% since the latest earnings results.

Werner (NASDAQ:WERN)

Conducting business in over a 100 countries, Werner (NASDAQ:WERN) offers full-truckload, less-than-truckload, and intermodal delivery services.

Werner reported revenues of $760.8 million, down 6.2% year on year. This print fell short of analysts’ expectations by 1.2%. Overall, it was a disappointing quarter for the company with a miss of analysts’ earnings estimates.

“While industry-wide headwinds remain, second quarter earnings improved sequentially, and we made progress on controlling the controllables. One-Way Truckload production increased for the fifth consecutive quarter. Mexico and cross-border related business is growing double-digits. Dedicated revenue per truck was up, and Logistics segment returned to positive operating income,” said Derek Leathers, Chairman and CEO.

Unsurprisingly, the stock is down 10.3% since reporting and currently trades at $36.35.

Read our full report on Werner here, it’s free.

Best Q2: Heartland Express (NASDAQ:HTLD)

Founded by the son of a trucker, Heartland Express (NASDAQ:HTLD) offers full-truckload deliveries across the United States and Mexico.

Heartland Express reported revenues of $274.8 million, down 10.3% year on year, in line with analysts’ expectations. The business had an exceptional quarter with an impressive beat of analysts’ earnings estimates and operating margin estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 7.2% since reporting. It currently trades at $11.56.

Is now the time to buy Heartland Express? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Hertz (NASDAQ:HTZ)

Started with a dozen Model T Fords, Hertz (NASDAQ:HTZ) is a global car rental company providing vehicle rental services to leisure and business travelers.

Hertz reported revenues of $2.35 billion, down 3.4% year on year, falling short of analysts’ expectations by 4.3%. It was a disappointing quarter as it posted a miss of analysts’ earnings estimates.

Hertz delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 19.3% since the results and currently trades at $3.30.

Read our full analysis of Hertz’s results here.

RXO (NYSE:RXO)

With access to millions of trucks, RXO (NYSE:RXO) offers full-truckload, less-than-truckload, and last-mile deliveries.

RXO reported revenues of $930 million, down 3.4% year on year. This print met analysts’ expectations. It was a very strong quarter as it also recorded an impressive beat of analysts’ volume estimates.

The stock is down 7.6% since reporting and currently trades at $27.62.

Read our full, actionable report on RXO here, it’s free.

Saia (NASDAQ:SAIA)

After realizing that there was more success in delivering produce rather than selling it, Saia (NASDAQ:SAIA) makes less-than-truckload deliveries in the United States.

Saia reported revenues of $823.2 million, up 18.5% year on year. This number met analysts’ expectations. Zooming out, it was a slower quarter as it produced a miss of analysts’ earnings estimates.

The stock is down 10.4% since reporting and currently trades at $436.81.

Read our full, actionable report on Saia here, it’s free.

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