We maintain our Outperform recommendation for Ryder System (R) on strong second quarter results and a solid earnings projection. Despite the negative impacts of the Japan disruption and an uncertain economic outlook, earnings beat the Zacks Consensus Estimate on higher pricing, acquisitions, and increased sales in commercial rental and used vehicle sales.
Ryder's continued investments in fleets and technology upgrades will fuel earnings growth despite high maintenance costs and the negative in the near-term impact of the disaster in Japan. The strong balance sheet encourages the company to expand its footprint via acquisitions.
Further, Ryder remains committed to its shareholders via dividends and share repurchases. Thus, we remain optimistic on the company's growth prospects.
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