HomeMost PopularInvestingSchneider (SNDR) is Slumping - Here's Why It's Time to Jump Ship

Schneider (SNDR) is Slumping – Here’s Why It’s Time to Jump Ship

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SNDR is Weathering Several Setbacks: Schneider National, Inc. (SNDR) is currently facing a host of challenges that have tarnished its appeal as an investment option.

One such hurdle is the downward revision of earnings estimates. The Zacks Consensus Estimate for current-quarter earnings has been slashed by a staggering 52.2% over the past 90 days. The outlook for 2023 and 2024 is equally grim, with the consensus mark for earnings plummeting by 20.5% and 17.3% in the same time frame, respectively. These dismal revisions signal a lack of trust from brokers in the company’s trajectory.

Faltering Zacks Rank and Style Score: Schneider currently holds a Zacks Rank #5 (Strong Sell) and boasts a feeble Momentum Style Score of F, underscoring its short-term unattractiveness.

Underwhelming Stock Performance: SNDR has nosedived by 21% over the past three months, in stark contrast to the industry’s 11% decline.

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Image Source: Zacks Investment Research

Additional Setbacks: The company is grappling with tepid performances across all its segments β€” Truckload, Intermodal, and Logistics. The lackluster showing can be attributed to a range of factors, including diminished network prices, reduced volume and revenue per order, as well as a decline in revenue impacted by lower spot prices and a dip in brokerage volume.

Adding to the adversity is the lowered 2023 adjusted earnings per share guidance range of $1.40-$1.45, down from the prior projection of $1.75-$1.90.

Poor Industry Standing: SNDR is part of an industry ranked 206 out of a total of 250 groups. The unfavorable position places it in the bottom 18% of Zacks industries. Research has shown that approximately 50% of a stock’s price movement is directly linked to the performance of the industry group it belongs to.

Considering the industry’s performance is crucial since a mediocre stock in a robust group is likely to outperform a strong stock in a weak industry.

Superior Alternatives

Investors may want to consider other options within the Transportation sector, such as Wabtec Corporation (WAB) and SkyWest, Inc. (SKYW). Both companies currently hold a Zacks Rank of 2 (Buy), making them more compelling choices compared to Schneider.

WAB is anticipated to witness an earnings growth rate of 22.02% for the current year and has delivered a trailing four-quarter earnings surprise of 7.11%, on average. Meanwhile, SKYW’s fleet-modernization initiatives have been acknowledged, with its current-year earnings estimate surging by 31.5% over the past 90 days and its shares skyrocketing by 181.3% year to date.

Commanding Lead in the Semiconductor Sector

Amidst all the chaos, there is a tiny semiconductor stock that has been identified as the #1 contender in the market, demonstrating remarkable earnings growth and an expanding customer base. With a bright future ahead, this stock is projected to capitalize on the growing demand for Artificial Intelligence, Machine Learning, and Internet of Things. The global semiconductor manufacturing industry is poised to explode from $452 billion in 2021 to $803 billion by 2028.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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