Unpacking Q3 Earnings: Commercial Vehicle Group (NASDAQ:CVGI) In The Context Of Other Heavy Transportation Equipment Stocks
Looking back on heavy transportation equipment stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Commercial Vehicle Group (NASDAQ:CVGI) and its peers.
Heavy transportation equipment companies are investing in automated vehicles that increase efficiencies and connected machinery that collects actionable data. Some are also developing electric vehicles and mobility solutions to address customers’ concerns about carbon emissions, creating new sales opportunities. Additionally, they are increasingly offering automated equipment that increases efficiencies and connected machinery that collects actionable data. On the other hand, heavy transportation equipment companies are at the whim of economic cycles. Interest rates, for example, can greatly impact the construction and transport volumes that drive demand for these companies’ offerings.
The 14 heavy transportation equipment stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 1.2%.
Thankfully, share prices of the companies have been resilient as they are up 7.1% on average since the latest earnings results.
Commercial Vehicle Group (NASDAQ:CVGI)
Formed from a partnership between two distinct companies, CVG (NASDAQ:CVGI) offers various components used in vehicles and systems used in warehouses.
Commercial Vehicle Group reported revenues of $171.8 million, down 30.4% year on year. This print fell short of analysts’ expectations by 22.6%. Overall, it was a disappointing quarter for the company with full-year revenue guidance missing analysts’ expectations.
James Ray, President and Chief Executive Officer, said, “Since taking over the CEO role eleven months ago, we have been tirelessly focused on reshaping the CVG operating model to create a more streamlined, lower cost, and customer-focused company.”
Commercial Vehicle Group Total Revenue
Commercial Vehicle Group delivered the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update of the whole group. Unsurprisingly, the stock is down 16.3% since reporting and currently trades at $2.58.
With more than half of the heavy-duty truck market using its engines at one point, Cummins (NYSE:CMI) offers engines and power systems.
Cummins reported revenues of $8.46 billion, flat year on year, outperforming analysts’ expectations by 1.8%. The business had a stunning quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ adjusted operating income estimates.
Cummins Total Revenue
The market seems happy with the results as the stock is up 13.6% since reporting. It currently trades at $370.
With its first trailer reportedly built on two sawhorses, Wabash (NYSE:WNC) offers semi trailers, liquid transportation containers, truck bodies, and equipment for moving goods.
Wabash reported revenues of $464 million, down 26.7% year on year, falling short of analysts’ expectations by 2.8%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
Interestingly, the stock is up 9% since the results and currently trades at $18.60.
Having designed the industry’s first double-decker railcar in the 1980s, Greenbrier (NYSE:GBX) supplies the freight rail transportation industry with railcars and related services.
Greenbrier reported revenues of $1.05 billion, up 3.5% year on year. This print met analysts’ expectations. Aside from that, it was a satisfactory quarter as it also recorded a solid beat of analysts’ EPS estimates but a significant miss of analysts’ sales volume estimates.
The stock is up 31.3% since reporting and currently trades at $67.59.
Also known as Wabtec, Westinghouse Air Brake Technologies (NYSE:WAB) provides equipment, systems, and its related software for the railway industry.
Wabtec reported revenues of $2.66 billion, up 4.4% year on year. This result missed analysts’ expectations by 0.5%. Taking a step back, it was a satisfactory quarter as it also produced a solid beat of analysts’ adjusted operating income estimates but a slight miss of analysts’ organic revenue estimates.
The stock is up 5% since reporting and currently trades at $199.07.
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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