Editor's Note

YRCW said trucking demand was strong and would be significantly stronger the rest of the year.


New positions are only added on Wednesday and Saturday except in special circumstances.


YRCW - YRC Worldwide - Company Description

YRC Worldwide Inc., through its subsidiaries, provides various transportation services primarily in North America. Its YRC Freight segment offers various services to transport industrial, commercial, and retail goods; and provides specialized services, including guaranteed expedited services, time-specific deliveries, cross-border services, coast-to-coast air delivery, product returns, temperature-sensitive shipment protection, and government material shipments. It serves manufacturing, wholesale, retail, and government customers. As of December 31, 2017, this segment had a fleet of approximately 7,600 tractors comprising 5,900 owned and 1,700 leased; and 30,900 trailers consisting of 23,800 owned and 7,100 leased. The company's Regional Transportation segment provides regional delivery services, which include next-day local area delivery and second-day services, consolidation/distribution services, protect-from-freezing and hazardous materials handling, truck loading, and other specialized offerings; guaranteed and expedited delivery services consisting of day-definite, hour-definite, and time definite capabilities; interregional delivery services; and cross-border delivery services, as well as operates hollandregional.com, newpenn.com, and reddawayregional.com, which are e-commerce Websites offering online resources to manage transportation activities. This segment had a fleet of approximately 6,500 tractors, including 4,700 owned and 1,800 leased; and 13,700 trailers comprising 10,500 owned and 3,200 leased. The company was formerly known as Yellow Roadway Corporation and changed its name to YRC Worldwide Inc. in January 2006. YRC Worldwide Inc. was founded in 1924. Company description from FinViz.com.

Earnings August 2nd.

YRCW kicked it into overdrive after reporting a loss of 44 cents that was much better than the 60 cents analysts expected. Revenue of $1.22 billion matched estimates.

While those earnings are not really a lot to get excited about the company lost 78 cents in the year ago quarter. Consensus guidance for 2018 is for EARNINGS of 78 cents after losing 33 cents in2017.

Consolidated operating ratio for Q1 was 100.4 and is allowing YRCW to charge premium rates because of the high utilization, low excess capacity. The company is charging 6% more per hundredweight year over year including fuel charges and 4.4% without surcharges.

The trucking business is very busy today with signing bonuses for experienced drivers in the $5K to $10K range and a large package of benefits. Everything in the economy moves by truck and that means YRCW is primed to benefit from the economic boom.

Shares spiked $2.00 (23%) on the earnings beat. After a week of post earnings depression shares are moving higher again. They closed at a 3-month high on Friday.

Buy YRCW shares, currently $10.89, stop loss $9.65.
Alternate position: Buy July $12 call, currently 53 cents. Stop loss $9.65.


No New Bearish Plays