Published on 8 Nov 2021 on Zacks via Yahoo Finance
A high proportion of companies belonging to the widely diversified Zacks Transportation sector already released their respective results for the third quarter of 2021. With fuel expenses comprising a significant chunk of the total costs incurred by any transportation company, the current scenario of high fuel costs hurt the bottom lines of all the companies, which have reported results so far. Oil price was up 2.1% in the third quarter from the second-quarter levels.
Apart from high fuel costs, supply-chain issues and labor shortage hurt the third-quarter results of the likes of Ryder System R and Westinghouse Air Brake Technologies Corporation WAB. Moreover, disruptions caused by Hurricane Ida hurt results of the transportation companies, which already reported results.
On the brighter side, the gradual uptick in economic activities boosted the railroad results that are already out. Evidently, freight revenues of Union Pacific UNP improved 12% year over year in the third quarter. Moreover, passenger revenues rose at airlines owing to betterment of air-travel demand.