The shipping industry has had a turbulent start to 2025, with global trade facing shifting tides. From geopolitical tensions and new tariffs to technological advancements and sustainability efforts, the logistics sector is undergoing a transformation.

Despite concerns over supply chain disruptions and potential overcapacity, the sector remains on a steady growth path, with the global shipping and logistics market projected to expand from $5.7 trillion in 2024 to $8.1 trillion by 2033 at a CAGR of 4%. Moreover, advancements in AI, machine learning, and sustainable logistics are reshaping the landscape, helping companies navigate these challenges and seize new opportunities.

With this evolving backdrop, Matson, Inc. (MATX - Get Rating) is set to report its fiscal 2024 fourth-quarter earnings today after the bell. As the industry rebounds, could this shipping stock be one to watch?

For the fourth quarter, analysts expect the company’s revenue to increase 7.9% year-over-year to $851.78 million. The company’s adjusted earnings per share are forecasted to sit at $3.20, up 79.8% year-over-year. Moreover, the company has an impressive earnings history, having beaten the consensus EPS estimates in each of the trailing four quarters.

In the last reported quarter, MATX exceeded the adjusted EPS estimate by 24.1%, but its revenue of $962 million came in slightly below the forecasted $965.73 million. Given this performance, the upcoming earnings report has the potential for another beat.

Over the past year, shares of MATX have gained 22.6%, closing the latest trading session at $143.31. It has also gained 5.8% year-to-date.

Here are the financial aspects of MATX that could influence its price performance in the near term:

Stable Historical Growth

Over the past five years, MATX has demonstrated consistent growth across key financial metrics. Its revenue and EBITDA grew at a CAGR of 8.3% and 24.6%, respectively. Moreover, net income and EPS expanded at a CAGR of 36.2% and 42.5%, respectively, over the same time frame.

Sound Financials

For the fiscal 2024 third quarter that ended September 30, 2024, MATX’s total operating revenues increased 16.3% year-over-year to $962 million. Its operating income grew 83.4% from the prior year’s quarter to $242.30 million.

Additionally, the company’s net income and EPS amounted to $199.10 million and $5.89, reflecting an increase of 66.6% and 73.2% year-over-year, respectively. Also, its EBITDA for the quarter came in at $289.40 million, up 65.3% year-over-year.

As of September 30, 2024, MATX’s cash and cash equivalents amounted to $270.30 million, compared to $134 million on December 31, 2023.

Attractive Dividend

On January 23, 2025, buoyed by its strong financial performance, the company declared a quarterly dividend of $0.34 per common share, payable to its shareholders on March 6, 2025. MATX pays a $1.36 per share dividend annually, which translates to a 0.95% yield on the current share price. Its four-year dividend yield is 1.35%.

The company’s dividend payouts have grown at CAGRs of 5.9% and 9% over the past three and five years, respectively. Moreover, MATX has a record of 11 years of consecutive dividend growth.

High Profitability

MATX’s trailing-12-month EBIT margin of 14.30% is 37.5% higher than the industry average of 10.40%. Its trailing-12-month net income margin stands at 12.37%, 93.4% higher than the industry average of 6.40%.

In addition, the company boasts a trailing-12-month levered FCF margin of 14.56%, which is 108.7% higher than the sector average of 6.97%. Also, the stock’s trailing 12-month Return on Total Capital (ROTC) of 9.34% outperforms the industry average of 6.99% by 33.7%.

POWR Ratings Reflects Optimism

MATX’s sound fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, which equates to a Buy in our proprietary rating system. The POWR Ratings are calculated by taking into account 118 different factors, with each factor weighted to an optimal degree.

Our proprietary rating system also evaluates each stock based on eight distinct categories. MATX boasts a B grade for Growth, which is consistent with its solid financial performance in the last reported quarter. The stock also has a B grade for Quality, supported by profitability measures that exceed industry benchmarks.

Within the B-rated Shipping industry, MATX is ranked #4 out of 34 stocks. Beyond what is stated above, we have also given MATX grades for Value, Momentum, Stability, and Sentiment. Get all MATX ratings here.

Bottom Line

As global trade rebounds and the shipping industry adapts to new challenges, Matson stands out with its strong financial performance, consistent earnings growth, and shareholder-friendly dividend policy. The company’s solid revenue expansion, high profitability, and history of beating EPS estimates position it well for continued success.

With MATX set to report earnings, investors should watch closely to see if it can maintain its momentum and capitalize on industry tailwinds.

How Does Matson, Inc. (MATX) Stack Up Against Its Peers?

Although MATX’s near-term outlook appears sound, it may be worthwhile to explore its industry peers, who also exhibit even stronger POWR Ratings. So, consider these A (Strong Buy) and B (Buy) rated stocks from the Shipping industry: Overseas Shipholding Group, Inc. (OSG - Get Rating), A.P. Møller – Mærsk A/S (AMKBY - Get Rating), and Global Ship Lease, Inc. (GSL - Get Rating).

To explore more A or B-rated Shipping stocks, click here.

What To Do Next?

Get your hands on this special report with 3 low priced companies with tremendous upside potential even in today’s volatile markets:

3 Stocks to DOUBLE This Year >

MATX shares were trading at $140.23 per share on Tuesday morning, down $3.08 (-2.15%). Year-to-date, MATX has gained 4.26%, versus a 0.87% rise in the benchmark S&P 500 index during the same period.

About the Author: Shweta Kumari

Shweta's profound interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help retail investors make educated investment decisions. More...

More Resources for the Stocks in this Article