Schneider National, Inc. (SNDR) in Green Bay, Wisc., is a premier transportation and logistics services provider that operates in North America. It operates through three segments: Truckload; Intermodal; and Logistics. With more than 25,000 containers, SNDR has one of the largest intermodal fleets in North America.
The company has capitalized on the increased demand for freight transportation services amid ongoing global logistics disruption. SNDR achieved record earnings of more than $530 million in its fiscal year 2021 and is on track to generate $1 billion in dedicated revenues. SNDR CEO and President Mark Rourke said, “As we look ahead, we anticipate that the supply and demand conditions experienced in 2021 will extend well into 2022…We expect continued capital allocation toward both organic and inorganic growth opportunities to further differentiate our platform.”
Shares of SNDR have gained 7.8% in price over the past year and 12.5% over the past six months to close yesterday’s trading session at $25.09.
Here’s what could shape SNDR’s performance in the near term:
Impressive Growth Prospects
Analysts expect SNDR’s revenues to rise 26.6% in its fiscal 2022 first quarter (ending March), 18.6% in the fiscal second quarter (ending June 2022), and 15.3% in fiscal 2022. Consensus EPS estimates indicate a 66.9% improvement in the current quarter, a 6.5% rise in the next quarter, and a 9.33% increase in the current quarter. In addition, the Street expects SNDR’s EPS to improve at a 19.5% CAGR over the next five years.
In terms of forward non-GAAP P/E, SNDR is currently trading at 10.02x, which is 43% lower than the 17.59x industry average. Its 0.51 forward non-GAAP PEG multiple is 62.9% lower than the 1.39 industry average, while its 0.69 forward Price/Sales ratio is 50.7% lower than the 1.40 industry average.
In addition, the stock’s 1.59 and 5.13 respective forward Price/Book and Price/Cash Flow ratios compare with 2.53 and 13.43 industry averages. Also, SNDR’s 4.84 forward EV/EBITDA multiple is 57.3% lower than the 11.33 industry average.
Consensus Rating and Price Target Indicate Potential Upside
Of the 11 Wall Street analysts that rated SNDR, six rated it Buy while three rated it Hold and two rated it Sell. The 12-month median price target of $31.18 indicates a 24.3% potential upside from yesterday’s closing price of $25.09. The price targets range from a low of $23.00 to a high of $39.00.
POWR Ratings Reflect Rosy Prospects
SNDR has an overall A rating, which equates to Strong Buy in our proprietary POWR Ratings system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
SNDR has an A grade for Momentum and a B for Growth and Value. The stock is currently trading above its 50-day and 200-day moving averages of $26.08 and $24.03, respectively, indicating an uptrend, in sync with its Momentum grade. Also, SNDR’s revenues and net income have risen at CAGRs of 4.1% and 14.7%, respectively, over the past three years, justifying its Growth grade. In addition, the stock’s lower-than-industry valuation metrics are in sync with the Value grade.
Of the 22 stocks in the A-rated Trucking Freight industry, SNDR is ranked #4.
Beyond what I’ve stated above, view SNDR ratings for Sentiment, Stability, and Quality here.
SNDR is actively increasing its operational capacity to strengthen its position as a leading freight transportation services provider in North America. The company plans to double its intermodal fleet size by 2030. On December 31, 2021, SNDR acquired Midwest Logistics Systems, Ltd., a leading dedicated carrier in the central United States, to expand its operations in the country. Last month, the company also partnered with Union Pacific Corporation (UNP) as part of its intermodal growth strategy and its sustainability goals.
As global supply chain disruptions continue, analysts expect SNDR’s revenues and earnings to grow rapidly over the next few quarters. Thus, we think SNDR could be an ideal investment bet now.
Note that SNDR is one of the few stocks handpicked currently in the Reitmeister Total Return portfolio. Learn more here.
How Does Schneider National, Inc. (SNDR) Stack Up Against its Peers?
While SNDR has an A rating in our proprietary rating system, one might want to consider looking at its industry peers P.A.M. Transportation Services, Inc. (PTSI), Daseke, Inc. (DSKE), and USA Truck, Inc. (USAK), which also have an A (Strong Buy) rating.
Note that DSKE is one of the few stocks handpicked by our Chief Growth Strategist, Jaimini Desai, currently in the POWR Stocks Under $10 portfolio. Learn more here.
Note that USAK is one of the few stocks handpicked by our Chief Value Strategist, Steve Reitmeister, currently in the POWR Value portfolio. Learn more here.
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SNDR shares were unchanged in premarket trading Thursday. Year-to-date, SNDR has declined -6.76%, versus a -11.16% rise in the benchmark S&P 500 index during the same period.
About the Author: Aditi Ganguly
Aditi is an experienced content developer and financial writer who is passionate about helping investors understand the do’s and don'ts of investing. She has a keen interest in the stock market and has a fundamental approach when analyzing equities. More...
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