Ryder System (R) AI Stock Analysis

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Ryder System

(NYSE:R)

Rating:69Neutral

Price Target:―

Ryder System's overall stock score reflects its strong financial performance and attractive valuation, offset by technical indicators suggesting bearish trends. The company's strategic initiatives and asset-light business model present opportunities for stable earnings growth, but high leverage and market challenges pose risks. Continued improvement in profitability and effective capital management will be key to enhancing shareholder value.

Positive Factors

Earnings Growth

Ryder delivered a solid operating beat with EPS growing 17% year over year, outperforming the median of flat growth for the sector.

Future Guidance

FY25 guidance came in ahead of expectations, driving the stock higher despite conservative cycle assumptions.

Valuation

Discounted valuation screens favorably in a group where multiples have drifted to cycle highs.

Negative Factors

Investor Sentiment

Investors have been hesitant to underwrite much of Ryder's gains as structural, and this quarter likely does little to help move that forward.

Market Conditions

Q4 EPS outlook is conservatively set below consensus, reflecting weaker market conditions and vehicle sales.

Revenue Growth

Management assumes a muted growth environment with only 2% revenue growth, comfortably below long-term targets.

Ryder System (R) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$6.17B

Dividend Yield2.1%

Average Volume (3M)373.99K

Price to Earnings (P/E)13.1

Beta (1Y)1.21

Revenue Growth6.21%

EPS Growth47.05%

CountryUS

Employees50,700

SectorIndustrials

Sector Strength93

IndustryRental & Leasing Services

Share Statistics

EPS (TTM)2.46

Shares Outstanding41,340,794

10 Day Avg. Volume347,541

30 Day Avg. Volume373,994

Financial Highlights & Ratios

PEG Ratio3.59

Price to Book (P/B)2.02

Price to Sales (P/S)0.00

P/FCF Ratio-49.53

Enterprise Value/Market Cap2.38

Enterprise Value/Revenue0.29

Enterprise Value/Gross Profit5.78

Enterprise Value/Ebitda1.89

Forecast

1Y Price Target

$163.33

Price Target Upside9.41% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering3

Ryder System Business Overview & Revenue Model

Company DescriptionRyder System, Inc. is a leading logistics and transportation solutions company headquartered in Miami, Florida. The company operates in various sectors including supply chain, dedicated transportation, and commercial fleet management. Ryder's core services are focused on full-service leasing, rental, and maintenance of commercial trucks, as well as supply chain management and logistics solutions tailored to meet the needs of its diverse client base.

How the Company Makes MoneyRyder System primarily generates revenue through three main segments: Fleet Management Solutions (FMS), Supply Chain Solutions (SCS), and Dedicated Transportation Solutions (DTS). In the FMS segment, Ryder earns money by providing full-service leasing, commercial rental, and maintenance services for trucks and other vehicles. The SCS segment contributes to revenue through comprehensive supply chain management services, including warehousing, distribution, and transportation management. Lastly, the DTS segment generates income by offering dedicated transportation services, where Ryder provides vehicles and drivers to customers on a long-term basis. Strategic partnerships with manufacturers and logistics companies, as well as a focus on technology and innovation, further enhance Ryder's ability to drive earnings across these segments.

Ryder System Financial Statement Overview

Summary

Ryder System’s financial performance shows robust revenue growth and improved operational efficiency, as reflected in rising EBIT margins and strong operating cash flow. However, profitability at the net income level remains a challenge, and the company's high leverage could pose risks in less favorable economic conditions. Continued focus on managing capital expenditures and improving net profit margins will be crucial for long-term financial health.

Income Statement

Positive

Ryder System has shown strong revenue growth over the past years, with a 31.5% increase in revenue from 2020 to 2025 TTM. The gross profit margin in the TTM period stands at 25.9%, indicating effective cost management. However, the net profit margin is relatively lower at 3.95%, reflecting challenges in translating revenue growth into bottom-line profitability. Despite fluctuations, the EBIT margin has improved to 7.4% in the TTM, showcasing operational efficiency improvements.

Balance Sheet

Positive

The company's balance sheet indicates a moderately high debt-to-equity ratio of approximately 2.58, which may pose a risk if revenue declines. Return on Equity (ROE) is at 16.7% in the TTM, reflecting a solid return for shareholders. The equity ratio is relatively low at 18.3%, suggesting a higher reliance on debt financing.

Cash Flow

Positive

Ryder's operating cash flow remains robust, with a positive cash flow to net income ratio of 4.76, indicating efficient cash generation relative to net income. However, free cash flow has been negative recently, with a significant improvement from -$881 million in 2023 to -$121 million in 2025 TTM, highlighting challenges in capital expenditure management.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
12.70B	12.64B	11.78B	12.46B	9.66B	8.42B
	Gross Profit
2.54B	2.47B	2.30B	2.84B	1.80B	1.28B
	EBIT
1.09B	1.07B	878.00M	-385.00M	-1.13B	-1.91B
	EBITDA
2.86B	2.90B	2.93B	3.39B	2.70B	2.26B
	Net Income Common Stockholders
502.00M	489.00M	406.00M	867.00M	519.00M	-112.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
151.00M	154.00M	204.00M	267.00M	234.00M	151.30M
	Total Assets
16.42B	16.67B	15.78B	14.39B	13.83B	12.93B
	Total Debt
8.82B	8.88B	8.15B	7.89B	6.58B	6.61B
	Net Debt
8.67B	8.73B	7.94B	7.63B	6.35B	6.46B
	Total Liabilities
13.42B	13.55B	12.71B	11.46B	11.04B	10.68B
	Stockholders Equity
3.00B	3.12B	3.07B	2.94B	2.80B	2.26B
Cash Flow		Free Cash Flow
-121.00M	-418.00M	-881.00M	-321.00M	233.90M	1.03B
	Operating Cash Flow
2.39B	2.27B	2.35B	2.31B	2.18B	2.18B
	Investing Cash Flow
-2.03B	-2.45B	-2.66B	-1.85B	-1.45B	-601.00M
	Financing Cash Flow
-424.00M	153.00M	256.00M	-861.00M	-203.71M	-1.51B

Ryder System Technical Analysis

Technical Analysis Sentiment

Positive

Last Price149.28

Price Trends

50DMA

142.81

Positive

100DMA

150.24

Negative

200DMA

149.01

Positive

Market Momentum

MACD

3.21

Positive

RSI

52.26

Neutral

STOCH

22.87

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For R, the sentiment is Positive. The current price of 149.28 is above the 20-day moving average (MA) of 147.89, above the 50-day MA of 142.81, and above the 200-day MA of 149.01, indicating a bullish trend. The MACD of 3.21 indicates Positive momentum. The RSI at 52.26 is Neutral, neither overbought nor oversold. The STOCH value of 22.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for R.

Ryder System Risk Analysis

Ryder System disclosed 25 risk factors in its most recent earnings report. Ryder System reported the most risks in the “Production” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Ryder System Peers Comparison

Overall Rating

UnderperformOutperform

Sector (65)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MGRC	79 Outperform	$2.79B	11.75	22.80%	1.68%	7.31%	91.99%
GATX	69 Neutral	$5.15B	18.28	11.64%	1.63%	12.07%	11.93%
R	69 Neutral	$6.17B	13.06	16.41%	2.10%	6.21%	47.05%
HRI	68 Neutral	$3.58B	28.02	9.60%	2.14%	8.34%	-63.02%
Sector *	65 Neutral	$4.41B	12.06	5.22%	249.80%	4.09%	-12.16%
HEES	56 Neutral	$3.47B	38.00	15.74%	1.16%	-3.52%	-46.60%
CAR	56 Neutral	$4.21B	8.26	78.26%	―	-2.78%	-296.07%

* Industrials Sector Average

Performance Comparison

Ryder System

149.28

31.14

26.36%

CAR

Avis Budget

119.71

8.47

7.61%

GATX

144.29

11.31

8.51%

HEES

H&E Equipment Services

94.64

48.04

103.09%

HRI

Herc Holdings

125.68

-12.85

-9.28%

MGRC

Mcgrath Rentcorp

113.38

5.01

4.62%

Ryder System Earnings Call Summary

Earnings Call Date:Apr 23, 2025

(Q1-2025)

% Change Since: 8.75%|

Next Earnings Date:Jul 24, 2025

Earnings Call Sentiment Neutral

Ryder's first quarter results show strong earnings growth driven by strategic initiatives and increased shareholder returns. However, challenges remain with declining rental demand and used vehicle sales proceeds. Despite a muted economic environment, the company remains confident in its transformed business model.

Q1-2025 Updates

Positive Updates

Double-Digit Earnings Growth

Ryder delivered double-digit earnings growth in the first quarter, driven by a high-quality contractual portfolio and a balanced growth strategy, with comparable EPS expected to be between $12.85 and $13.60 for 2025.

Increased Free Cash Flow and Shareholder Returns

The 2025 forecast for free cash flow was increased to a range of $375 million to $475 million, primarily due to lower expected capital spending. Ryder returned $202 million to shareholders by repurchasing 1.1 million shares and paying dividends.

Supply Chain and Dedicated Transportation Growth

Supply Chain earnings increased 35% year-over-year, and Dedicated Transportation Solutions' (DTS) earnings increased 50% year-over-year, reflecting acquisition synergies and strong performance of legacy business.

Negative Updates

Decline in Rental Demand

Fleet Management Solutions' operating revenue increased only 1% due to lower rental demand, and rental utilization on the power fleet was 66%, in line with the prior year but below historical trends.

Decreased Used Vehicle Sales Proceeds

Year-over-year, used tractor proceeds declined 16%, and used truck proceeds declined 17%. Sequentially, tractor proceeds decreased 7%, and truck proceeds decreased 8%, primarily due to the sale of aged inventory.

Challenging Market Conditions

The updated forecast reflects a more muted macroeconomic environment and weaker rental demand, with Class 8 production in the U.S. now expected to be down 20% from the initial forecast of a 1% increase.

Company Guidance

During Ryder System's first quarter 2025 earnings call, the company provided guidance indicating a strong performance despite a challenging market environment. Ryder reported a 2% increase in operating revenue to $2.6 billion, driven by growth in their supply chain and Fleet Management Solutions (FMS) segments. The company achieved a 17% return on equity (ROE) over the trailing 12-month period and expects 2025 comparable EPS to be between $12.85 and $13.60. Ryder increased its free cash flow forecast to $375 million to $475 million, reflecting lower capital expenditures. The company returned $202 million to shareholders through dividends and share repurchases. Despite weaker rental and used vehicle sales markets, Ryder remains confident in its asset-light business strategy and contractual portfolio, which are expected to deliver stable earnings growth and support long-term strategic initiatives, with a focus on increasing profitability and capital deployment capacity.

Ryder System Corporate Events

Business Operations and StrategyFinancial Disclosures

Ryder System Reports 21% Increase in Q1 2025 EPS

Positive

Apr 23, 2025

Ryder System, Inc. reported a 21% increase in GAAP EPS from continuing operations for the first quarter of 2025, driven by strategic initiatives that bolstered contractual earnings across all segments despite weaker market conditions in rental and used vehicle sales. The company’s total revenue rose by 1% to $3.1 billion, with operating revenue increasing by 2% due to acquisition and contractual revenue growth in Supply Chain Solutions and Fleet Management Solutions. Ryder’s strategic initiatives, including lease pricing and maintenance optimization, are expected to continue yielding benefits throughout 2025, demonstrating the resilience of its business model.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.