(The Associated Press circulated the following on December 3.)
NEW YORK — Shares of major railroads and truckload carriers mostly fell Monday after an analyst said fuel surcharge timing lags and reimbursement delays could hurt fourth-quarter results.
JPMorgan analyst Thomas R. Wadewitz lowered his fourth-quarter earnings estimates for the six major Class I railroads by an average of 2.8 percent, and cut his estimates for three truckload companies by an average of 8.7 percent.
The most significant estimate reductions were for truckload carrier Werner Enterprises Inc. and railroad operator CSX Corp.
Among transportation companies, truckload carriers are being hurt most by higher diesel prices with only about 80 percent of fuel expenses covered by surcharges, Wadewitz said.
Railroads’ fuel expense is mostly covered by surcharges, but reimbursements are often delayed by as much as two months, which is likely to hurt fourth-quarter results, the analyst noted.
Fourth-quarter earnings are expected to be weak across the sector with railroad companies posting the best results, Wadewitz said. Truckload and less-than-truckload carriers earnings reports should be the weakest, as slumping demand and poor pricing compounds fuel issues.
Among major railroad operators, Union Pacific Corp. rose 61 cents to $126.75, while shares of Burlington Northern Santa Fe Corp. slipped 4 cents to $83.48. Norfolk Southern Corp. added 46 cents to $51.67, and CSX fell 36 cents to $41.64.
In the trucking sector, Heartland Express Inc. fell 41 cents, or 2.8 percent, to $14.12, and Knight Transportation Inc. fell 19 cents to $15.01. Werner Enterprises fell 21 cents to $17.34.