Ryder System (R): Assessing Valuation After Recent Share Price Momentum

Ryder System (R) has recently experienced a modest bump, rising 1% in the past day and gaining 3% for the month. Investors often weigh such moves in the context of the company’s long-term performance and growth trends.

See our latest analysis for Ryder System.

Over the past year, Ryder System has quietly built momentum. The company posted a 1-year total shareholder return of 35%, reflecting both share price gains and dividends. Recent price moves suggest renewed investor interest, especially as fundamentals continue to improve.

If Ryder's steady progress has you thinking about other opportunities, consider expanding your search and discover fast growing stocks with high insider ownership.

This recent momentum begs the question: with Ryder's fundamentals and outlook, is there still an undervalued story here for investors to seize, or has the market already priced in the company’s future growth potential?

Most Popular Narrative: 1.7% Undervalued

With Ryder System’s fair value pegged at $196.56, just above the last close price of $193.21, the consensus narrative sees only a slight undervaluation. However, a closer look at the underlying business model reveals forces driving both optimism and caution among analysts.

Strategic investment in technology (telematics, digital platforms, data analytics) and supply chain optimization initiatives are driving operational efficiencies and productivity gains, enhancing net margins and improving long-term return on equity.

Read the complete narrative.

Wondering what gives this narrative its edge? The valuation hinges on future profit margins and ambitious efficiency targets. The full story uncovers which business segments must outperform and just how aggressive the analysts’ assumptions really get.

Result: Fair Value of $196.56 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, ongoing freight market weakness or declines in used vehicle prices could quickly unravel these optimistic forecasts and challenge Ryder’s longer term growth narrative.

Find out about the key risks to this Ryder System narrative.

Another View: SWS DCF Model Challenges the Narrative

While analysts see Ryder System as slightly undervalued using future earnings and profit margins, the SWS DCF model suggests caution. By projecting Ryder’s future cash flows, our DCF calculation values the stock lower than the current price. This implies it could actually be overvalued. Which approach best captures the underlying reality for prospective investors?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Ryder System for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Ryder System Narrative

If you see the story differently or want to try your own analysis, you can easily build your version in just a few minutes. Do it your way.

A great starting point for your Ryder System research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

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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.

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