This weekly report summarizes the most recent views and research of Wolfe Research. Included are (1) three to five snippets or key takeaways from our team's recent channel checks with traffic managers about their experiences with purchasing, competition, and service from Airfreight and Logistics, Rail, and Truck capacity providers; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight and logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
This weekly report summarizes the most recent views and research of Wolfe Research. Included are (1) three to five snippets or key takeaways from our team's recent channel checks with traffic managers about their experiences with purchasing, competition, and service from Airfreight and Logistics, Rail, and Truck capacity providers; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight and logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
Total Week 2 Rail vols grew 4.5% y/y, up from -4.0% and +2.0% the prior 2 weeks and better than +1.3% over the past 6 weeks. Vols for the Canadian rails (+17%) again materially outperformed the U.S. rails (+2%), and all of the rails likely benefited from some catch-up vols following inclement weather over the past several weeks. Reported y/y vols should remain positive as comps remain very easy.
Excluding a one-time $0.25 tax benefit, BNI posted 4Q EPS of $1.30, solidly above Cons. of $1.22 and our $1.20. As reported, Rev. was slightly better while costs and margins were much better than we expected. However, mgmt noted a $30M or $0.05/shr benefit from coal rate adjustments in the qtr. We also suspect BNI recorded some one-time benefits in its Materials & Other line which was $73M ($0.13/shr) lower than we expected and at its lowest level since 4Q:97.
Total Week 1 Rail vols dropped 4.0% y/y, down from +2.0% and +10.9% the prior 2 weeks and worse than -0.6% over the past 6 weeks. Strength in Canadian rail vols (+10%) partially offset weakness in the U.S. (-7%). We believe the U.S. rails were hurt by bad weather in the Midwest and Southeast. Going forward, reported y/y vols should turn positive as comps remain very easy.
This weekly report summarizes the most recent views and research of Wolfe Research. Included are (1) three to five snippets or key takeaways from our team's recent channel checks with traffic managers about their experiences with purchasing, competition, and service from Airfreight and Logistics, Rail, and Truck capacity providers; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight and logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
Total Week 52 Rail vols increased 2.0% y/y vs. +10.9% and +4.7% the prior 2 weeks. While New Years occurred this week both this year and in the year-ago period, there can still be significant volatility during holiday weeks. Total vols finished 4Q down 6.9%, sharply improved from -17.0% during 3Q. Vols still declined 16% in C09 for the worst y/y performance since the 1940s.
We are updating our Rail models to reflect better than expected vols in 4Q:09, relatively firm pricing and modestly lower than expected diesel fuel prices, offset somewhat by weakening service metrics. We are raising our 4Q estimates on avg. by 4%. We now generally expect upside reports for the U.S. rails, and we see the most potential upside for KSU and UNP.
Total Week 51 Rail vols increased 10.9% y/y vs. +4.7% and -6.4% the prior 2 weeks. While Christmas occurred this week both this year and in the year-ago period, there can still be significant volatility during holiday weeks. Total vols are now tracking down 7.4% QTD with 1 week remaining, sharply improved from -17.0% during 3Q and -16.2% YTD.
Total Week 50 Rail vols increased 4.7% y/y, sharply improved from -6.4% and -5.7% the prior 2 weeks on a much easier comp. Recall that rail vols dropped sharply after Thanksgiving a year ago. Vols also increased 2.9% sequentially this week, much better than seasonally normal, likely helped by some catch-up vols following bad weather in the Midwest the prior week.