Looking back on marine transportation stocks' Q1 earnings, we examine this quarter's best and worst performers, including Matson (NYSE:MATX) and its peers.
The growth of e-commerce and global trade continues to drive demand for shipping services, presenting opportunities for marine transportation companies. While ocean freight is more fuel efficient and therefore cheaper than its air and ground counterparts, it results in slower delivery times, presenting a trade off. To improve transit speeds, the industry continues to invest in digitization to optimize fleets and routes. However, marine 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. Geopolitical tensions can also affect access to trade routes, and if certain countries are banned from using passageways like the Panama Canal, costs can spiral out of control.
The 5 marine transportation stocks we track reported an ok Q1; on average, revenues missed analyst consensus estimates by 1.4%. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, but marine transportation stocks have shown resilience, with share prices up 8.2% on average since the previous earnings results.
Matson (NYSE:MATX) Founded by a Swedish orphan, Matson (NYSE:MATX) is a provider of ocean transportation and logistics services.
Matson reported revenues of $722.1 million, up 2.5% year on year, in line with analysts' expectations. Overall, it was a good quarter for the company with a decent beat of analysts' earnings estimates.
Matt Cox, Matson's Chairman and Chief Executive Officer, commented, "We are off to a solid start for the year with Ocean Transportation performing better than expected and Logistics meeting expectations in the first quarter. Within Ocean Transportation, our China service experienced healthy demand coming out of a more traditional post-Lunar New Year period with a gradual recovery of volume after factories reopened and workers returned compared to a more accelerated increase in volume experienced post-Lunar New Year last year. In our domestic ocean tradelanes, we achieved a comparable level of demand in Guam as compared to 2023, and we saw modestly lower year-over-year volumes in Hawaii and Alaska primarily due to lower general demand and an additional northbound sailing in the year ago period, respectively. Logistics operating income in the first quarter declined year-over-year due to continued market softness in transportation brokerage."
The stock is up 23.4% since reporting and currently trades at $132.87.
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Best Q1: Kirby (NYSE:KEX) Transporting goods along all three U.S. coasts, Kirby (NYSE:KEX) provides inland and coastal marine transportation services.
Kirby reported revenues of $808 million, up 7.7% year on year, outperforming analysts' expectations by 2.5%. It was a very strong quarter for the company with an impressive beat of analysts' earnings estimates and a decent beat of analysts' Marine Transportation revenue estimates.
Kirby pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 28.3% since reporting. It currently trades at $129.65.
Weakest Q1: Genco (NYSE:GNK) Headquartered in NYC, Genco (NYSE:GNK) is a shipping company that transports dry bulk cargo along worldwide maritime routes.
Genco reported revenues of $79.09 million, up 42.5% year on year, in line with analysts' expectations. It was a weak quarter for the company with a miss of analysts' earnings estimates.
As expected, the stock is down 9.5% since the results and currently trades at $20.51.
Scorpio Tankers (NYSE:STNG) Operating one of the youngest fleets in the industry, Scorpio Tankers (NYSE: STNG) is an international provider of marine transportation services, specializing in the shipment of refined petroleum.
Scorpio Tankers reported revenues of $389.8 million, up 3.3% year on year, surpassing analysts' expectations by 2.1%. Taking a step back, it was a very strong quarter for the company with a decent beat of analysts' earnings estimates.
The stock is flat since reporting and currently trades at $75.79.
Pangaea (NASDAQ:PANL) Established in 1996, Pangaea Logistics (NASDAQ:PANL) specializes in global logistics and transportation services, focusing on the shipment of dry bulk cargoes.
Pangaea reported revenues of $104.7 million, down 7.9% year on year, falling short of analysts' expectations by 10.8%. Revenue aside, it was a mixed quarter for the company with an impressive beat of analysts' earnings estimates.
Pangaea had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is down 1.9% since reporting and currently trades at $7.63.
This content was originally published on Stock Story
