Here's Why Investors Should Give Ryder System Stock a Miss Now

Ryder System R is grappling with challenges arising from increased operating expenses, which are adversely impacting the company’s performance, making it an unattractive choice for investors’ portfolios.

Let us delve deeper.

R: Key Risks to Watch

Southward Earnings Estimate Revision:The Zacks Consensus Estimate for current-quarter earnings has been revised 6.2% downward in the past 60 days. Meanwhile, for 2025, the consensus mark for earnings has been revised 1.96% downward.

The unfavorable estimate revision indicates brokers’ lack of confidence in the stock.

Dim Price Performance:  Ryder System’s price trend reveals that its shares have fallen 8.8% over the quarter-to-date period compared with the Transportation - Equipment and Leasing industry’s 3.6% decline.

Weak Zacks Rank: R currently has a Zacks Rank #4 (Sell).

Bearish Industry Rank: The industry to which Ryder System belongs currently has a Zacks Industry Rank of 196 (out of 246). Such an unfavorable rank places it in the bottom 19% of Zacks Industries. Studies show that 50% of a stock’s price movement is directly related to the performance of the industry group it belongs to.

A mediocre stock within a strong group is likely to outclass a robust stock in a weak industry. Reckoning the industry’s performance becomes imperative.

Headwinds: Ryder System continues to face significant financial pressure due to elevated operating costs and weak liquidity. In the third quarter of 2025, the company’s operating expenses remained high. This uptick was primarily driven by 3.26% rise in the selling, general and administrative (SG&A) expenses, which constitutes 13.2% of the total operating expenses.

The trend of rising costs is not new for Ryder System. The company has experienced a consistent increase in operating expenses over recent years, with year-over-year growth of 7.3% in 2024, 3.4% in 2023 and 20.4% in 2022. This sustained upward trajectory in expenses poses substantial risks to R’s operational and financial stability.

Moreover, companies like Ryder System are navigating a volatile macro environment marked by economic uncertainty, shifting tariff regulations and geopolitical tensions.

Stocks to Consider

Investors interested in the Zacks Transportation sector may consider Expeditors International of Washington EXPD and SkyWest SKYW.

EXPD currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

EXPD has an expected earnings growth rate of 2.3% for the current year.  The company has an encouraging earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in the trailing four quarters, delivering an average beat of 13.94%.

SKYW currently carries a Zacks Rank #2 (Buy).

SkyWest has an anticipated earnings growth rate of 33% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in the trailing four quarters, delivering an average beat of 21.2%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

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

Zacks Investment Research