For immediate release
Chicago, IL – July 2, 2021 – Zacks.com announces the list of stocks featured on the Analysts Blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Stocks recently featured in the blog include: DHT Holdings, Inc. DHT, FedEx Corporation FDX, Expeditors International of Washington, Inc. EXPD, and Matson, Inc. MATX.
Here are highlights from Thursday’s analyst blog:
Transportation stocks boost dividend hikes: 3 solid choices
It’s no secret that stocks in the highly diverse transportation sector were one of the hardest hit last year due to the coronavirus pandemic. As revenues dwindle, companies in various parts of the industry resorted to a host of cost-cutting measures, including holidays, layoffs and reduced discretionary spending as they struggled to weather the crisis. liquidity.
Notably, the economic chaos triggered by the coronavirus has shaken the financial stability of many companies, with transportation companies being no exception. Due to the gloomy demand scenario, some of the industry participants have resorted to dividend cuts or dividend payment deferrals. For example, management at DHT Titles reduced 75% of its quarterly dividend to 5 cents per share in February. That was further reduced from 20% to 4 cents a share in May.
Additionally, airlines in the United States have had to withhold dividend payments as a prerequisite for obtaining federal support. Additionally, transportation companies, which have neither reduced nor withdrawn dividend payouts, have continued to reward their shareholders through economic turmoil at their current rate with no hikes seen in the industry.
However, the scenario has improved in recent months, leading to a resumption of economic activities. With widespread immunization programs in place, the demand scene is clearing up day by day and this bodes well for businesses at all levels.
Reflecting better economic conditions, the freight scenario in the United States has become quite optimistic as can be assessed from the latest Cass Freight Shipments Index report, which showed that shipping volumes jumped 35.3% on a annual in May. Notably, that record rise in May was higher than the 27.6% year-over-year increase reported in April and a 10% jump recorded in March.
As a result of this improved environment, many companies in the transportation sector have resumed sharing the profits with their shareholders in the form of higher dividends. This is a huge boon for investors interested in Zacks’ transportation business which has grown 8.2% since the start of the year.
In particular, investors always prefer an income-generating action. Therefore, a high dividend is obviously highly coveted. Needless to say, shareholders are always looking for players with a consistent and incremental dividend history to park their money.
3 stocks to buy now
In view of the bullish scenario mentioned above, we present three transport companies that have recently announced dividend increases and represent excellent investment opportunities. Companies not only currently have a Zacks # 1 (strong buy) or 2 (buy) ranking, but have also seen favorable revisions to earnings estimates over time. You can see The full list of today’s Zacks # 1 Rank stocks here.
FedEx is our first choice. The Memphis, Tennessee-based parcel delivery company currently has a Zacks ranking of 1. The company is benefiting from booming e-commerce demand which has driven the stock up 14.9% since beginning of the year.
In June, FedEx’s board of directors approved a 15% increase in its quarterly dividend, bringing the amount to 75 cents per share. The dividend will be paid on July 12 to its shareholders of record on June 28. FedEx has an impressive track record of returning funds to its shareholders. A strong generation of free cash flow supports these shareholder-oriented activities.
The positivity surrounding the stock is evident from the 6.2% upward revision to Zacks’ consensus estimate for current year earnings over the past 60 days. FedEx earnings per share are expected to increase 12% over the next three to five years.
Washington International Expeditors is our next choice. This Seattle, WA based freight forwarder is currently a Zacks # 1 ranked player. The company is supported by the recovery in air freight revenues. Notably, the company’s shares have jumped 33.1% since the start of the year. In May 2021, Expeditors announced an 11.5% increase in its semi-annual cash dividend, bringing the total to 58 cents per share. The company has an impressive track record in using its shareholders’ money.
The optimism surrounding the stock is evident from the 21.4% northward revision of Zacks’ consensus estimate for current year earnings over the past 60 days.
Investors can also count on Matson, which is one of the leading providers of shipping and logistics services. The company currently carries a Zacks Rank # 2. The growing cash flow of the Honolulu, Hawaii-based company underscores its financial strength. In June, its board of directors authorized a 30.4% increase in its quarterly dividend, bringing the total to 30 cents per share. The first tranche of the increased dividend will be paid on September 2, 2021 to its shareholders of record on August 5.
Over the past 60 days, the company has seen Zacks’ consensus estimate for 2021 move 8.7% north. The stock has gained 12.3% year-to-date on favorable winds such as improved freight demand and cost management actions.
Zacks names “best single choice to overtake”
Among thousands of stocks, 5 Zacks experts each chose their favorite to soar + 100% or more in the coming months. Of these 5, research director Sheraz Mian chooses one to have the most explosive advantage of all.
You’ve known this company from its past glory days, but few would expect it to be ready for a monster turnaround. Fresh out of a successful repositioning and flush with A-List celebrity mentions, it could rival or overtake other recent Zacks stocks which are expected to double as Boston Beer Company which climbed + 143.0% in just a bit. more than 9 months and Nvidia which climbed + 175.9% in a year.
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