Old Dominion Freight Line, Inc.ODFL reported third-quarter 2018 earnings per share (EPS) of $2.12, which surpassed the Zacks Consensus Estimate of $1.97. The bottom line also surged 71% on a year-over-year basis. Results were aided by a lower effective tax rate.
Quarterly revenues of $1,058.2 million missed the consensus mark of $1,059.2 million. However, the top line increased 21.2% on a year-over-year basis. The upside was primarily driven by 8.1% and 12.5% increase in LTL tons and LTL revenue per hundredweight, respectively.
In the quarter under review, LTL revenue per hundredweight was up 9%, excluding fuel surcharges. Also, LTL shipments improved 9.7%. However, LTL weight per shipment declined 1.4% in the third quarter.
Additionally, operating ratio improved 280 basis points (bps) to 78.4%. Effective tax rate in the quarter under review declined to 24.3% from 37.8% in the prior-year quarter. The reduction was primarily caused by the new tax law (Tax Cut and Jobs Act). The company expects effective tax rate to be 25.9% for the final quarter of the year.
Old Dominion Freight Line, Inc. Price, Consensus and EPS Surprise
As of Sep 30, 2018, this Zacks Rank #2 (Buy) company rewarded shareholders to the tune of $108.6 million through dividends ($32 million) and buybacks ($76.6 million). Old Dominion exited the quarter with cash and cash equivalents of $177.5 million. Debt-to-total capitalization ratio at the end of the quarter was 1.7% compared with 4% at the end of 2017. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Capital expenditures in the quarter totaled $177.6 million. For 2018, Old Dominion continues to expect capital expenditures of $555 million. Of the total amount, $200 million is anticipated to be spent on real estate and service center expansion while approximately $300 million and $55 million is estimated to be spent on tractors and trailers, and technology and other assets, respectively.
Investors interested in the broader Transportation sector are awaiting third-quarter 2018 earnings reports from key players like ArcBest Corporation ARCB , Atlas Air Worldwide Holdings, Inc. AAWW and C.H. Robinson Worldwide, Inc. CHRW . C.H. Robinson will release results on Oct 30. ArcBest Corporation and Atlas Air Worldwide will announce the same on Nov 1.
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