Why Triton International shares rose today
Shares of Triton International ( TRTN 0.41% ) climbed 13% on Friday after the intermodal freight container lessor reported better-than-expected quarterly results. The company is holding up well despite the challenges of the pandemic, and Wall Street is taking notice.
Before markets open Friday, Triton International reported second-quarter adjusted earnings of $0.86 per share on revenue of $321.4 million, beating consensus estimates of $0.78 per share. profit action on $309 million in sales. Overall revenue held up well, down just 5% year-on-year.
The company confirmed that the pandemic and resulting economic shutdowns “have resulted in a significant decrease in global trade”, saying Triton customers estimate container shipping volumes are down 15% year-on-year. the other in the second trimester.
In a statement, CEO Brian M. Sondey said customers, including major shipping lines, have been aggressive in cutting expenses and low fuel prices have helped soften the blow.
“We are concerned that the sharp decline in global container volumes this year will increase the financial challenges facing our customers,” Sondey said. “Although we have not yet weathered the pandemic, container freight rates and our customers’ financial performance have generally held up better than expected.”
Bank of America analyst Ken Hoexter is a believer, posting a rare double upgrade to Triton’s post-earnings results, taking the company from underperformer to buy. Hoexter said he believes Triton is well positioned to benefit from any economic recovery.
As Sondey notes, we haven’t been through the pandemic yet. There is going to be continued uncertainty surrounding transportation inventory as long as economic activity is affected. But Triton says its customers are reporting volumes are improving as Europe and parts of the United States emerge from lockdowns.
Even after Friday’s rally, shares of Triton are still down 14.9% for the year. It’s too early to give the ‘everything is clear’ signal, but investors have every reason to be encouraged by the company’s progress.
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