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Trinity's (TRN) Q2 Earnings Miss Estimates, Decline Y/Y

Trinity Industries’ TRN second-quarter 2020 earnings of 2 cents per share (excluding $1.78 from non-recurring items) missed the Zacks Consensus Estimate of 8 cents. Moreover, the bottom line plunged 93.1% year over year.

Total revenues of $509.2 million surpassed the Zacks Consensus Estimate of $474 million. However, the top line dipped 30.8% year over year due to lower deliveries in the Rail Products Group and fewer railcars sold.

Since Nov 1, 2018, the company primarily reports via three segments — Railcar Leasing and Management Services Group, Rail Products Group and All Other Group.

The Railcar Leasing and Management Services Group generated revenues of $192.8 million, down 30.4% year over year. The downside was primarily caused by lower fleet utilization. Segmental operating profit amounted to $82.9 million, down 20.9% from the year-ago quarter’s figure due to lower volume of railcars sold.  

Revenues in the Rail Products Group (before eliminations) totaled $405.6 million, down 43.9% from the prior-year quarter’s number. Segmental operating profit was $7.9 million compared with $66.3 million a year ago. The decline in revenues and operating profit was caused by low railcar deliveries and reduced operational efficiency.  

Revenues at the All Other Group (primarily includes results of highway products business) were $69.3 million, 2.1% up year over year buoyed by higher demand at highway products business. Segmental operating profit came in at $7.3 million, compared with $7.9 million in the second quarter of 2019.

Trinity Industries, Inc. Price, Consensus and EPS Surprise

Trinity Industries, Inc. Price, Consensus and EPS Surprise

Trinity Industries, Inc. price-consensus-eps-surprise-chart | Trinity Industries, Inc. Quote

Liquidity

The Zacks Rank #4 (Sell) company exited the second quarter with cash and cash equivalents of $157 million compared with $166.2 million at 2019-end. Meanwhile, debt totaled $4,825.4 million as of Jun 30 compared with $4,881.9 million at the end of 2019. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Sectorial Snapshot

Apart from Trinity, let’s take a look into some other Zacks Transportation sector’s second-quarter earnings.

Canadian National CNI second-quarter 2020 earnings (excluding 36 cents from non-recurring items) of 92 cents per share (C$0.77) met the Zacks Consensus Estimate. However, the bottom line declined 28.7% year over year. Quarterly revenues of $2,315 million (C$3,209 million) missed the Zacks Consensus Estimate of $2,407.6 million and declined 21.8% year over year.

J.B. Hunt Transport JBHT carrying a Zacks Rank #3 (Hold), reported second-quarter earnings of $1.14 per share that surpassed the Zacks Consensus Estimate by 31 cents. Total revenues of $2,145.6 million also beat the Zacks Consensus Estimate of $2,060.9 million.

Kansas City Southern’s KSU second-quarter earnings (excluding a penny from non-recurring items) of $1.15 per share beat the Zacks Consensus Estimate of $1.12. This Zacks Rank #3 (Hold) company’s total revenues of $547.9 million lagged the Zacks Consensus Estimate of $550.2 million.

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