It has been about a month since the last earnings report for Triton International (NYSE:TRTN). Shares have added about 17.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Triton due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Triton International Q3 Earnings Beat
Triton International’s third-quarter 2020 earnings (excluding 47 cents from non-recurring items) of $1.14 per share beat the Zacks Consensus Estimate of $1.06. The bottom line dipped 1.7% year over year, but increased 32.6% from the second quarter of 2020, indicating a strong rebound from the coronavrius-induced slump in business. The company witnessed a spike in trade volumes and container demand during the third quarter with easing coronavirus-led restrictions in the United States and Europe.
However, total leasing revenues of $327.8 million decreased 2.6% year over year due to 2% decline in revenues from operating leases. Equipment trading revenues of $26.09 million inched up 1.2% from the year-ago quarter’s reported figure. Trading margin came in at $3.87 million compared with $4.15 million in the prior-year quarter.
The company generated a return on equity of 15.8% in the reported quarter compared with 16.1% in the year-ago quarter. Total operating expenses increased 6.5% to $183.59 million. The company exited the third quarter with average utilization of 96.1%, up 110 basis points sequentially.
The company repurchased 0.4 million shares during the third quarter. So far, it has bought back more than 12.5 million shares under the share-buyback plan cleared in August 2018.
Outlook
Triton anticipates its fourth quarter to benefit from revenues on the large number of containers picked up in the third quarter. Reduced interest expenses are also expected to aid performance. With this, the company estimates adjusted earnings per share to increase 25% in the fourth quarter from the third quarter of 2020.
For 2021, the company remains uncertain about its outlook given the ongoing coronavirus pandemic and its impact on the global economy. However, it expects to continue reaping benefits from reduced interest expenses in 2021 and beyond.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
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