Research Library
Below is our research library, listed in reverse chronological order. Please use the search box to look for research on a specific company or topic, or use the Calendar, Archives, or Sector links at left to browse for research from a specific time period or sector. If you are a Wolfe Trahan client and can not access any of the links in our library, please contact ITSupport@WolfeResearch.com to request our PDF decryption plug-in.
July US SAAR Stable from June
The June U.S. SAAR of 14.1M hit the high end of expectations in the 14.0M-14.1M range and was in line with June and up from 13.7M in May. OEMs saw significant declines in rental fleet sales, but retail sales improved through the month. Dealer inventory dropped to 55 days supply from 59 in June even with shorter than normal July plant shutdowns.
ALGT: Solid results but lower estimates; Catalysts fully intact
EPS of $1.30 was above the consensus estimate of $1.24 but below our estimate of $1.31. ALGT’s pretax margin of 17.2% should be the best in our coverage (CPA has yet to report), and though 3Q non-fuel costs cause us to lower EPS estimates, big picture catalysts remain intact and we remain resoundingly bullish on ALGT no matter what the investment time horizon. Success breeds options, and ALGT now possesses an embarrassment of cash (47% of LTM revenues) that begs to be deployed as it provides an EPS headwind of $0.39 in negative carry (our estimate), be it in the form of debt paydown, avoidance of new debt (e.g., buying new planes with cash), dividends, or share buybacks. ALGT’s board meets quarterly, next time in October.
Inside Freight: ABFS Unfavorable Court Ruling; NSC Dividend Increase and CFO Change; SWFT Debt Paydown; East Coast Port Labor Update; UPS; FDX; FWRD
U.S. District Court judge dismissed ABFS’s pending lawsuit against YRCW and the Teamsters. While this is not positive for ABFS, the suit was a long-shot in our view and ABFS still has an opportunity to negotiate wages with the Teamsters when its contract expires on March 31, 2013. Until then, we expect ABFS will continue to struggle to make earnings expectations and generate free cash without tonnage growth. NSC’s Board approved a 6% dividend increase yesterday to a 2.7% yield, and another 50M (15%) of share buybacks through C17. SWFT made a $25M voluntary pre-payment on its term loan which will add $0.01 to annual EPS. SWFT doesn’t have any principal debt payments due until 2H:13 and this pre-payment implies another modest reduction in net debt/EBITA below 2.9x.
RRTS 2Q Earnings: Strong Growth Continues; In-Line Quarter and Guidance
RRTS reported 2Q EPS of $0.32, in line with our est. and Cons. We believe RRTS should continue to take LTL share without the same labor and other cost inflation pressures facing the asset-based carriers. Recent LTL terminal additions and likely acquisitions should also support top-line growth later this year, while the shift toward independent contractors should drive continued LTL margin improvement.
Research Library
- Coverage List
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- Conference Calls
- Interactive Doh! Models
- Ed Wolfe Bi-Weekly Freight Update