Mixed Earnings Expectations For Transportation Giants

• Three leading transportation companies are due to report earnings this week.
• Expectations for the two rail giants and a big airline are very different.
• The ongoing Trump rally and anticipation of infrastructure spending marked the quarter.

The fourth-quarter earnings reporting season is underway, and among the many companies expected share their results this week are three transportation giants. But expectations are somewhat mixed, based on the analysts' consensus forecasts, even as the Trump rally rolled on in the period, with his promises of increased infrastructure spending.

Modest results are expected from rail leader CSX Corporation CSX, which during the period Barron's said could benefit from Trump's election. Mixed results are anticipated from peer Union Pacific Corporation UNP, which disappointed in its most recent earnings report. Meanwhile, United Continental Holdings Inc UAL is expected to say that both earnings and revenue slipped from a year ago. In the quarter, it came to light that Warren Buffett had taken stakes in United and other airlines.

Below is a quick look at what is expected from the results of these three, as well as a peek at some of the other upcoming quarterly reports from financial companies.

CSX

The fourth-quarter profit is anticipated to come in at $0.49 per share, which would be just a penny gain from the year-ago period, according to Wall Street analysts. The consensus of 25 Estimize respondents has earnings pegged at the same $0.49 per share. Note that both Wall Street and Estimize underestimated earnings in the prior two quarters.

In Tuesday afternoon's report, analysts also are looking for $2.87 billion in revenue for the three months that ended in December, compared with the $2.84 billion that Estimize predicts and the $2.78 billion posted in the year ago period. Both Wall Street and Estimize have underestimated top line results in most recent periods.

Union Pacific

In its report before Thursday's opening bell, this leading freight hauling railroad operator is expected to say that it had earnings per share of $1.33 in its fourth quarter, according to Estimize. That is the same as the Wall Street consensus estimate and would be up from $1.31 per share a year ago. Note that Union Pacific fell short of EPS estimates by a few cents in the previous quarter.

Estimize has overestimated revenue in most recent quarters, and this time, the 15 respondents are looking for $5.11 billion. Wall Street anticipates it come to $5.12 billion. Either forecast would be down from the $5.21 billion reported in the year-ago period, as well as the $5.17 billion from back in the third quarter.

United Continental

The consensus Wall Street forecast calls for this airline operator to post fourth-quarter EPS of $1.69 (down more than 33 percent from in the same period of last year) but for revenue to have slipped a bit to $9.03 billion. Note that analysts narrowly underestimated on both the top line and bottom lines in the prior quarter. Also, this latest EPS projection would be the second lowest in the past six quarters.

Estimize is even more pessimistic on the bottom line, with the consensus of 23 respondents pegging EPS at $1.47. Revenue of $8.88 billion also is predicted for the three months that ended in December. Estimize likewise underestimated earnings results in the third quarter. And United Continental is scheduled to share its latest results after trading concludes on Tuesday.

And Others

Other companies that are anticipated to report earnings gains this week include Citigroup, Goldman Sachs, Morgan Stanley, Netflix, Synchrony Financial, UnitedHealth and U.S. Bancorp. But if the analysts are correct, earnings at American Express, Fastenal, General Electric, Schlumberger and Skyworks Solutions will be smaller than a year ago.

Looking ahead to the following week, the earnings crunch is on. Watch for results from Alibaba, Alphabet, AT&T, Boeing, Chevron, Comcast, DuPont, Ford, Halliburton, Intel, Johnson & Johnson, Lockheed-Martin, McDonald's, Microsoft, Starbucks, 3M, Verizon and many others.