Wrapping up Q3 earnings, we look at the numbers and key takeaways for the heavy transportation equipment stocks, including Cummins (NYSE:CMI) and its peers.
Heavy transportation equipment companies are investing in automated vehicles that increase efficiencies and connected machinery that collects actionable data. Some are also developing electric vehicles and mobility solutions to address customers’ concerns about carbon emissions, creating new sales opportunities. Additionally, they are increasingly offering automated equipment that increases efficiencies and connected machinery that collects actionable data. On the other hand, heavy transportation equipment companies are at the whim of economic cycles. Interest rates, for example, can greatly impact the construction and transport volumes that drive demand for these companies’ offerings.
The 13 heavy transportation equipment stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 1.2%.
Thankfully, share prices of the companies have been resilient as they are up 8.7% on average since the latest earnings results.
Best Q3: Cummins (NYSE:CMI)
With more than half of the heavy-duty truck market using its engines at one point, Cummins (NYSE:CMI) offers engines and power systems.
Cummins reported revenues of $8.46 billion, flat year on year. This print exceeded analysts’ expectations by 1.8%. Overall, it was a stunning quarter for the company with a solid beat of analysts’ EBITDA estimates.
Interestingly, the stock is up 14.9% since reporting and currently trades at $374.20.
Is now the time to buy Cummins? Access our full analysis of the earnings results here, it’s free.
Allison Transmission (NYSE:ALSN)
Helping build race cars at one point, Allison Transmission (NYSE:ALSN) offers transmissions to original equipment manufacturers and fleet operators.
Allison Transmission reported revenues of $824 million, up 12% year on year, outperforming analysts’ expectations by 4.3%. The business had an exceptional quarter with a solid beat of analysts’ EBITDA estimates.
The market seems happy with the results as the stock is up 18.4% since reporting. It currently trades at $118.43.
Is now the time to buy Allison Transmission? Access our full analysis of the earnings results here, it’s free.
Slowest Q3: Wabash (NYSE:WNC)
With its first trailer reportedly built on two sawhorses, Wabash (NYSE:WNC) offers semi trailers, liquid transportation containers, truck bodies, and equipment for moving goods.
Wabash reported revenues of $464 million, down 26.7% year on year, falling short of analysts’ expectations by 2.8%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
Interestingly, the stock is up 16.2% since the results and currently trades at $19.83.
Read our full analysis of Wabash’s results here.
Wabtec (NYSE:WAB)
Also known as Wabtec, Westinghouse Air Brake Technologies (NYSE:WAB) provides equipment, systems, and its related software for the railway industry.
Wabtec reported revenues of $2.66 billion, up 4.4% year on year. This print lagged analysts' expectations by 0.5%. Aside from that, it was a satisfactory quarter as it also produced a solid beat of analysts’ adjusted operating income estimates.
The stock is up 5.7% since reporting and currently trades at $200.30.
Read our full, actionable report on Wabtec here, it’s free.
Federal Signal (NYSE:FSS)
Developing sirens that warned of air raid attacks or fallout during the Cold War, Federal Signal (NYSE:FSS) provides safety and emergency equipment for government agencies, municipalities, and industrial companies.
Federal Signal reported revenues of $474.2 million, up 6.2% year on year. This print lagged analysts' expectations by 1.6%. Zooming out, it was a mixed quarter as it also produced full-year EPS guidance exceeding analysts’ expectations but a miss of analysts’ backlog estimates.
The stock is up 13.8% since reporting and currently trades at $96.48.
Read our full, actionable report on Federal Signal here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September, a quarter in November) have kept 2024 stock markets frothy, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there's still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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