The Q4 earnings season is off to a strong start with impressive reports from big names like JPMorgan Chase & Co. JPM . According to our latest Earnings Preview report, 63 S&P 500 members (representing 19.1% in terms of market capitalization) have reported their quarterly numbers so far.
The picture to have emerged thus far is an extremely optimistic one with the bottom line expanding 4.7% and the top line growing 2.7%. Of the 63 companies to have unveiled their results thus far, 66.7% reported better-than-expected earnings, while 50.8% of these S&P 500 members surpassed top-line expectations.
However, the picture is not that rosy for the widely-diversified transportation sector (one of the 16 Zacks sectors). So far, 46.7% of the transportation companies (listed on the S&P 500 Index) have reported Q4 results. The bottom line for this space has contracted 15.1%, thanks to disappointing reports from the likes of Kansas City Southern KSU and Canadian Pacific Railway Limited CP .
This week will be an extremely busy one with earnings reports flowing in from all quarters. The current week will see 330 companies, including 105 S&P 500 players, reporting their financials. Coming back to the transportation sector, big names like American Airlines Group AAL and Southwest Airlines LUV will unveil their respective quarterly numbers this week.
As discussed above, the transportation sector continues to struggle. Hence, investors interested in this space will keenly await reports from key sector participants like Canadian National Railway CompanyCNI , Heartland Express, Inc.HTLD and Marten Transport, Ltd.MRTN .
Based in Montreal, Canadian National Railway Company is engaged in the rail and related transportation business. The company is scheduled to report Q4 results on Jan 24. According to our quantitative model, a company needs the right combination of two key ingredients - a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) - to increase the odds of an earnings surprise. Canadian National satisfies both conditions, making it likely to report better-than-expected Q4 earnings. The railroad operator currently has an Earnings ESP of +2.17% (the Most Accurate Estimate is 2 cents above the Zacks Consensus Estimate of 92 cents). The company has a Zacks Rank #2. You can see the complete list of today's Zacks #1 Rank stocks here .
Canadian National Railway Co. Price and EPS Surprise
Earlier too, our model had predicted an earnings beat. The values were a little different. The company had an Earnings ESP of +4.44% while carrying a Zacks Rank # 3 (Read more: Canadian National Q4 Earnings: Is a Beat in Store? ).
Heartland Express, Inc., based in North Liberty, IO, operates as a short-to-medium haul truckload carrier of general commodities. Things, however, appear bleak for the trucking company in Q4. Heartland Express has an Earnings ESP of -6.67% as the Most Accurate estimate is pegged at 14 cents, while the Zacks Consensus Estimate is 1 cent higher. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .
The company has a Zacks Rank #3. The combination makes an earnings beat unlikely in Q4. The company is expected to report its results on Jan 24.
Heartland Express Inc. Price and EPS Surprise
Marten Transport, Ltd., a Mondovi, WI-based, long-haul truckload carrier, is expected to release Q4 results on Jan 24. Our model does not indicate that the company is likely to beat earnings this quarter. This is because Marten Transport has a Zacks Rank #3 but an Earnings ESP of 0.00% (both the Most Accurate Estimate and the Zacks Consensus Estimate stand at 25 cents).
Marten Transport Ltd. Price and EPS Surprise
Looking for Ideas with Even Greater Upside?
Today's investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more. Click here for a peek at this private information >>