Dec. 18, 2015, 5:59 PM
Dec. 2, 2015, 12:17 PM
- Transportation stocks are lower on the day on some broad macroeconomic concerns. Some BAML downgrades in the sector are also weighing on sentiment.
- Trading is notably weak in CXS Corp (CSX -2.3%), American Railcar Industries (ARII -2.6%), Kansas City Southern (KSU -1.9%), YRC Worldwide (YRCW -5.7%), Heartland Express (HTLD -3.7%), Swift Transportation (SWFT -3%), FedEx (FDX -0.9%), UPS (UPS -0.5%), Air Transport Services (ATSG -1.7%), and Matson (MATX -2.5%).
- A notable exception to the sector slide is airline stocks which are showing strength after Delta Air Lines (DAL +2.7%) reported some eye-opening capacity constraint. The major carrier increased passenger revenue per available seat mile sand load factor during November. A 3% decline in crude oil prices is also factoring in to the rally in airline stocks.
- United Continental (UAL +3.2%), Hawaiian Holdings (HA +2.9%), Southwest Airlines (LUV +2.3%), and Republic Airways Holdings (RJET +4.4%) are all solidly higher.
- The Dow Jones Transportation Average is down 0.8% off the conflicting forces of gravity.
- Related ETFs: IYT, XTN, JETS.
Oct. 13, 2015, 1:12 PM
- Transportation stocks are weak today on macroeconomic concerns and with a guidance cut from Ryder capturing some attention. Investment firms have also chipped away at the airline and railroad sectors with downgrades and price target revisions.
- The move lower includes a wide variety of trucking, freight, and logistics stocks. FedEx (FDX -1.4%), Norfolk Southern (NSC -1.5%), CSX Corporation (CSX -1.7%), Knight Transportation (KNX -4.8%), J.B. Hunt Transport Services (JBHT -2.4%), Landstar System (LSTR -1.5%), Heartland Express (HTLD -2.7%), Air Transport Services Group (ATSG -1.6%), Allegiant Travel (ALGT -3.4%), Virgin America (VA -4.3%), and Hub Group (HUBG -2.9%) are all lower than broad market averages.
- The Dow Jones Transportation Average is off 1.76% vs. the S&P 500 -0.26%.
- Related ETFs: IYT, XTN.
Sep. 18, 2015, 1:44 PM
Sep. 3, 2015, 3:12 PM
- How bad a year has it been for multi-industry stocks? Year-to-date underperformance relative to the S&P 500 is among the poorest in a decade and has gotten worse in recent weeks, say Goldman analyst Joe Ritchie and team. The negative news is no secret: Broad industrial de-stock, softening oil capex, the strong dollar, and the troubles in China. Because of this, the team remains Neutral on the beaten-up sector, but does have a few names investors should steer clear of:
- With de-stock keeping U.S. industrial growth in a "headlock," the implications are particularly negative for Sell-rated Emerson Electric (NYSE:EMR), WW Grainger (NYSE:GWW), and Neutral-rated Parker-Hannifin (NYSE:PH) and Rockwell Automation (NYSE:ROK).
- With oil capex going from bad to worse, and oil lower for longer, the Street is underestimating the impact of price declines for Dover (NYSE:DOV), Emerson, and Flowserve (NYSE:FLS). On the flip side, lower input costs should be a boon to Buy-rated Illinois Tool Works (NYSE:ITW) and Neutral-rated 3M (NYSE:MMM).
- The weaker China backdrop is most negative for Emerson, and Neutral-rated Eaton (NYSE:ETN) and Colfax (NYSE:CFX). Though Buy-rated Honeywell (NYSE:HON) and ITT Corp (NYSE:ITT) have exposure, growth is more insulated due to their market share gains.
- Source: Barron's Ben Levinsohn
- ETFs: XHB, ITB, XLI, PHO, IYT, ITA, VIS, PPA, XTN, XAR, FIDU, PKB, IYJ, FXR, UXI, PRN, RGI, SIJ, PSCI, AIRR
Aug. 28, 2015, 10:50 AM
- UBS lines up three transportation stocks it sees as trading at attractive valuations.
- FedEx (FDX -0.2%): The shipping giant trades at a discount to UPS and is leveraged to e-commerce growth, notes the investment firm. The UBS price target of $195 implies 27% upside potential.
- Knight Transportation (KNX +2.9%): Lower fuel costs and strong GDP numbers bode well for the trucking stock. UBS has a price target of $33.
- Kansas City Southern (KSU +0.9%): UBS thinks additional capacity could make a difference for the railroad. A 19% breakout for shares to $111 is seen.
- Related ETFs: IYT, XTN.
Jun. 19, 2015, 2:16 PM
May 15, 2015, 11:02 AM
- Dow Theory types have something to worry about thanks to a widening spread between the record-setting DJIA (NYSEARCA:DIA) and the underperforming Dow Jones Transportation Average (XTN, IYT).
- The divergence began last November when the Transports hit a record-high. Since, the Transports are down 6.7% while the DJIA is ahead more than 2%.
- The editor of TheDowTheory.com, Jack Schannep found 14 instances of wide divergences over the last 25 years. In nine of them, the broader market subsequently declined by less than 10%, but in the other five, the fall averaged 25.7%, i.e. a full-scale bear market.
- ETFs: DIA, DOG, DXD, UDOW, SDOW, DDM, UDPIX
Mar. 20, 2015, 2:24 PM
Dec. 19, 2014, 1:44 PM
Jun. 30, 2014, 6:53 PM
- Barclays upgrades its view of the transportation sector to positive, as an improving fundamental backdrop is set to drive meaningful earnings expansion across a broad array of transport companies.
- Among signs of improving fundamentals: rail volume up 7%, U.S. trucking demand up 3%-4%, small package markets up 5%, and global trade up 5%-6% - all implying strong industrial demand.
- Sector valuations are the highest since the 2009 recession and has outperformed YTD, but with Q2 results ripe to usher in more bullish sentiment in the space, Barclays expects valuations could have further to run as markets discount a more robust outlook.
- The firm's top recommendations in sector are UNP, UPS, SWFT, CP and JBHT, while also upgrading CNI and NSC to Overweight, adding more exposure to the favorable North American rail vertical.
- ETFs: IYT, XTN.
Jan. 24, 2014, 12:08 PM
- Previously immune to the selloff in the broader averages, things catch up to the Dow Transports Index (IYT -3%), with today's decline following yesterday's new all-time record.
- Richard Russell alert? Followers of Dow Theory like to see industrials and transports moving together to confirm a trend. Prior to today's action the DJIA (DIA -1.2%) was down 2.3% YTD while the transports were up 2.3% - giving hope the broad market might be set to reverse course. Today's slump though, brings the transports into the red for the year.
- Another transport ETF is the XTN.
- DJIA ETFs: DIA, DOG, DXD, UDOW, SDOW, DDM
Oct. 7, 2011, 1:09 PM
Sterne Agee gets a tepid response from the market after initiating the airliners today: AMR (AMR -0.6%), Allegiant Travel (ALGT -2%), Delta (DAL -2%), JetBlue (JBLU -0.2%) and United Continental (UAL -3.2%) are all started with buys, and US Airways (LCC -3%) and Southwest Airlines (LUV -4%) are initiated with a neutral.| Oct. 7, 2011, 1:09 PM
Sep. 7, 2011, 12:31 PM
Fitch Ratings keeps its transportation-related ratings unchanged saying signs in the sector point to an economy growing, albeit at a slower rate. The usual suspects - higher oil and commodity prices, lower government spending and consumer tightening - were pinned by Fitch as leading causes for a slowdown in transportation activity.| Sep. 7, 2011, 12:31 PM
Aug. 25, 2011, 6:05 PMAirline shares took a hit today as investors anticipate a wave of flight cancellations due to Hurricane Irene. The ripple effects are likely to be felt across the country as flights become grounded throughout major U.S. travel corridors. United Continental (UAL -2.9%), AMR (AMR -2.9%), Delta (DAL -5.8%). | Aug. 25, 2011, 6:05 PM
Jul. 6, 2011, 3:11 PM
Arkansas Best (ABFS +9.6%) pops after saying it will increase freight rates by 6.9%, and winning an appeal to continue a lawsuit seeking $750M in damages from the Teamsters and other trucking companies.| Jul. 6, 2011, 3:11 PM
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