MIAMI - Ryder System, Inc. (NYSE: NYSE:R), a prominent player in supply chain, dedicated transportation, and fleet management solutions, has announced the acquisition of Cardinal Logistics, a move poised to enhance Ryder's dedicated transportation services across North America. The integration of Cardinal's operations is expected to bolster Ryder's scale and network density, adding 200 operating locations, 2,900 power vehicles, and 3,400 professional drivers to its already extensive portfolio.
Cardinal, headquartered in Concord, N.C., is known for providing dedicated fleets and professional drivers to manage complex route structures for various industries, including consumer packaged goods, omnichannel retail, grocery, building products, automotive, and industrial sectors. The acquisition is anticipated to be financially beneficial for Ryder by 2025 following the realization of synergies and the completion of integration processes.
Steve W. Martin, senior vice president of dedicated transportation for Ryder, highlighted the strategic fit of the acquisition, stating that it will enable greater economies of scale and flexibility to address the challenges of seasonality and demand fluctuations. Martin also emphasized the added value for customers through Ryder's technology platform, RyderShare™, which enhances end-to-end visibility and collaboration.
The founders of Cardinal, Tom Hostetler and Vin McLoughlin, will join Ryder as part of the acquisition. Both founders have a history with Ryder, having started their careers there, and expressed confidence in the cultural alignment and the future opportunities for Cardinal's employees and customers within Ryder's larger, diversified company.
The financial and legal aspects of the transaction were managed by Greenberg Traurig LLP for Ryder, while William Blair LLC and McDermott Will & Emery LLP represented Cardinal. Further details regarding the acquisition will be discussed during Ryder's fourth quarter conference call on February 14, 2024.
Ryder System, Inc., with nearly 260,000 commercial vehicles and approximately 300 warehouses totaling over 95 million square feet, continues to be recognized for its industry-leading practices and commitment to innovation, safety, and a diverse workforce.
This expansion is based on a press release statement and reflects Ryder's ongoing strategy to grow its dedicated business segment within the logistics and transportation industry.
InvestingPro Insights
In light of Ryder System's recent acquisition, investors and stakeholders may find the following metrics and tips from InvestingPro particularly enlightening. The company's market capitalization stands at a robust $5.03 billion, with a Price/Earnings (P/E) ratio of 10.95, indicating investor confidence in its earnings potential. Furthermore, the P/E ratio for the last twelve months as of Q3 2023 is adjusted to 18.26, reflecting a more comprehensive view of the company's valuation in relation to its earnings.
Revenue growth for the same period shows a modest increase of 2.82%, while the gross profit margin is healthy at 19.72%. These figures suggest a solid financial foundation as Ryder System integrates Cardinal Logistics into its operations.
InvestingPro Tips reveal that Ryder has maintained dividend payments for an impressive 48 consecutive years, a testament to its financial stability and commitment to shareholder returns. Additionally, analysts predict the company will be profitable this year, aligning with the positive outlook following the acquisition. For those seeking deeper insights and more such tips, InvestingPro offers additional expert analysis, with the subscription now on a special New Year sale with discounts of up to 50%. Use coupon code SFY24 to get an additional 10% off a 2-year InvestingPro+ subscription, or SFY241 to get an additional 10% off a 1-year InvestingPro+ subscription, and unlock the full suite of features and financial wisdom.
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