3 Transportation Stocks Positioned to Surpass Q2 Earnings Estimates

The Zacks Transportation sector is widely diversified in nature, including airlines, railroads, package delivery companies, and truckers, to name a few. Per the latest Earnings Outlook, second-quarter 2025 earnings of the S&P 500 members of the sector are expected to decline 4.7% year over year. Revenues are estimated to inch down 0.5%.

With quite a few players in this diversified sector yet to report their financial numbers, we expect the likes of Expeditors International of Washington EXPD, GXO Logistics GXO and ZIM Integrated Shipping Services ZIM to report better-than-expected earnings despite headwinds like weak freight demand, tariff-induced uncertainty, inflation-related woes and supply chain disruptions.

Let’s discuss the factors that are likely to have boosted the sector participants’ second-quarter performance.

The southward movement of oil price bodes well for the bottom-line growth of sector participants. This is because fuel expenses are a significant input cost for any transportation company. Crude oil has been struggling in 2025, with prices sliding to multi-month lows. Tariff concerns, weakening consumer confidence and production increase by OPEC+ have all contributed to this downward pressure. Oil price declined 6% in the April-June period.

Efforts to control costs for bottom-line growth amid the prevalent freight demand weakness are also likely to have aided players’ performances. Moreover, the fact that e-commerce is still a force to reckon with bodes well.

For U.S. airline companies in the sector, the stabilization of air travel demand, despite the tariff-induced economic uncertainties and the resultant reduction in consumer and corporate confidence, is a positive. Shipping companies, despite being hurt by the still-high inflation, tariff-related tensions and lingering supply-chain disruptions, demonstrate resilience, especially those prioritizing growth and operational efficiency.

Here’s How to Pick the Right Stocks

Quite a few transportation stocks are likely to report earnings shortly. It is always a daunting task for investors to pick a winning basket of stocks with the potential to deliver better-than-expected earnings. 

While there is no foolproof method of choosing outperformers, our proprietary methodology — the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — helps identify stocks with high chances of delivering a positive surprise in their upcoming earnings announcement. Our research shows that for stocks with this perfect mix of elements, the odds of an earnings beat are as high as 70%.

Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Our Choices

Expeditors, a leading third-party logistics provider, is based in Seattle, WA. EXPD currently has an Earnings ESP of +0.11% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The company is scheduled to report its second-quarter 2025 results on Aug. 5.

While weak volumes (with respect to air-freight tonnage and ocean containers) stemming from soft demand and declining rates are likely to have hurt EXPD’s performance, efforts to cut costs in the face of demand weakness are likely to have driven its bottom line. EXPD beat the Zacks Consensus Estimate in each of the last four quarters, the average being 13.3%.

Expeditors International of Washington Price and EPS Surprise

Expeditors International of Washington, Inc. price-eps-surprise | Expeditors International of Washington, Inc. Quote

GXO Logistics, a pure-play contract logistics provider, is headquartered in Greenwich, CT.  GXO currently has an Earnings ESP of +8.33% and a Zacks Rank of 3. The company is slated to report second-quarter 2025 results on Aug. 5.

Increased e-commerce, automation and outsourcing are likely to aid the company’s results. Cost-cutting efforts are also likely to have boosted the bottom-line performance of GXO. The company beat the Zacks Consensus Estimate in three of the last four quarters,  and missed once, with the average beat being 3.9%.

GXO Logistics Price and EPS Surprise

GXO Logistics, Inc. price-eps-surprise | GXO Logistics, Inc. Quote

ZIM Integrated Shipping is a global container liner shipping company. ZIM currently has an Earnings ESP of +20.66% and a Zacks Rank of 3. ZIM has an asset-light model, which allows it to focus more on leasing rather than owning vessels. This allows it to adjust capacity rapidly in response to market changes.

ZIM’s focus on niche markets and high-margin trade routes helps it avoid crowded, low-margin segments, thereby maintaining strong pricing power. This also boosts profitability. The shipping company’s operational efficiency is being aided by investments in digitalization and innovative technologies. ZIM beat the Zacks Consensus Estimate in each of the last four quarters by an average of 34.5%. The company is scheduled to report its second-quarter 2025 results on Aug. 20.

ZIM Integrated Shipping Services Price and EPS Surprise

ZIM Integrated Shipping Services Ltd. price-eps-surprise | ZIM Integrated Shipping Services Ltd. Quote

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This article originally published on Zacks Investment Research (zacks.com).

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