Analysts Are Updating Their Ryder System, Inc. (NYSE:R) Estimates After Its First-Quarter Results

Ryder System, Inc. (NYSE:R) came out with its first-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Results were roughly in line with estimates, with revenues of US$3.1b and statutory earnings per share of US$2.27. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Our free stock report includes 1 warning sign investors should be aware of before investing in Ryder System. Read for free now.

Following last week's earnings report, Ryder System's six analysts are forecasting 2025 revenues to be US$12.8b, approximately in line with the last 12 months. Statutory per share are forecast to be US$11.99, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of US$12.9b and earnings per share (EPS) of US$12.33 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

View our latest analysis for Ryder System

It might be a surprise to learn that the consensus price target was broadly unchanged at US$161, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Ryder System analyst has a price target of US$175 per share, while the most pessimistic values it at US$144. This is a very narrow spread of estimates, implying either that Ryder System is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Ryder System's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 0.9% growth on an annualised basis. This is compared to a historical growth rate of 9.2% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that Ryder System is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Ryder System. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Ryder System analysts - going out to 2027, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Ryder System that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.