Werner Enterprises’ Q2 Results Meet Expectations; Shares Pop

Werner Enterprises, Inc. (WERN), a transportation and logistics services provider, delivered second-quarter results in line with analysts’ expectations. Shares popped 3.2% to close at $46.05 on July 29. (See Werner Enterprises stock charts on TipRanks)

WERN reported earnings of $0.86 per share, up 40% year-over-year, and meeting analysts’ estimates of $0.86 per share.

Revenue grew 14% to $649.81 million, slightly surpassing the Street’s estimate of $648.82 million. Werner’s Truckload Transportation and Logistics Services revenues grew 10% and 29% year-over-year, respectively.

Derek J. Leathers, Chairman, President and CEO said, “The rapidly recovering economy combined with a severely constrained driver market is presenting labor challenges for customers and carriers alike…Werner achieved record second quarter results based on our strong execution in a robust freight market.”

For the full year 2021, Werner guided for its Truckload Transportation Services fleet to grow between 1% – 4% annually, including the July 1 acquisition of ECM Transport Group, with a fleet of 500 trucks.

Following the results, Cowen & Co. analyst Jason Seidl reiterated a Hold rating on the stock and lowered the price target to $52 (12.9% upside potential) from $54.

Seidl noted that Werner’s bottom line was affected by higher costs driven by a tight freight market in its logistics segment, and also stated that its One-way truckload demands are showing bullish trends moving into the third quarter.

Seidl said, “Werner is well positioned to benefit from truckload demand while possessing the resources necessary to ramp up capacity in the face of driver shortages and the Hours-of-Service regulations.”

Overall, the stock has a Hold consensus rating based on 3 Buys, 3 Holds, and 3 Sells. The average Werner Enterprises price target of $51.25 implies 11.3% upside potential to current levels. Shares have gained 18.7% year to date.