Why Is Knight-Swift (KNX) Down 7.2% Since Last Earnings Report?

Core Viewpoint - Knight-Swift Transportation Holdings reported a mixed performance in its latest earnings report, with adjusted earnings exceeding estimates but total revenues falling short, indicating potential challenges ahead for the company [1][2][3]. Financial Performance - Adjusted earnings for Q4 2024 were 36 cents per share, surpassing the Zacks Consensus Estimate of 33 cents and showing over 100% year-over-year improvement [2]. - Total revenues amounted to $1.86 billion, missing the Zacks Consensus Estimate of $1.89 billion and declining 3.5% year-over-year [3]. - Operating expenses decreased by 6.6% year-over-year to $1.78 billion, leading to an improved adjusted operating ratio of 93.7%, which is over 300 basis points better than the prior-year quarter [3]. Segment Performance - Truckload segment revenues totaled $1.10 billion, down 4.4% year-over-year, with adjusted operating income increasing by 22.9% to $85.96 million [4]. - The Less-Than-Truckload segment generated revenues of $278.89 million, up 20.2% year-over-year, but adjusted operating income fell 54.9% to $15.21 million [5]. - Logistics revenues were $167.99 million, a 2.1% year-over-year increase, while intermodal revenues reached $99.04 million, up 4.9% year-over-year [6]. Liquidity and Debt - Knight-Swift ended Q4 with cash and cash equivalents of $218.26 million, an increase from $166.34 million in the previous quarter, while long-term debt decreased to $1.44 billion from $1.50 billion [8]. Guidance - The company expects adjusted EPS for Q1 2025 to be in the range of 29-33 cents and for Q2 2025 to be between 46-50 cents [9]. - Net cash capital expenditures for 2025 are projected to be between $575 million and $625 million, with an expected tax rate of 24.5-25.5% [10]. Market Sentiment - Estimates for Knight-Swift have trended upward over the past month, with the stock currently holding a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [11][13]. - The company has a subpar Growth Score of D, a Momentum Score of C, and a Value Score of C, placing it in the middle 20% for investment strategy [12].