Ryder Raises Adjusted EPS Outlook to $15.05 After 21% Quarterly Growth
Key Facts
Ryder reported results for the third quarter ended September 30, 2026, with diluted earnings from continuing operations of $4.16 per share under generally accepted accounting principles (GAAP) and adjusted earnings of $4.33 per share under the company’s non-GAAP measure. The company said adjusted earnings rose 21% year over year, while GAAP earnings per share increased 25%. Total revenue was $3.433 billion, up 8% from the year-earlier period. Operating revenue, a non-GAAP measure, reached $2.759 billion, up 6%. The company presented these figures in its official results without comparing them with analyst estimates.
Ryder raised its fiscal 2026 adjusted earnings-per-share outlook to a range of $14.85–$15.05 and lifted its return-on-equity outlook, a non-GAAP measure, to 18–19%. It kept its operating revenue growth outlook at 3%. These figures differ from its GAAP earnings-per-share outlook, as the company expects about $4.30 per share in noncash pension settlement charges. For the fourth quarter, Ryder expects adjusted earnings per share of $4.25 to $4.45, compared with a range from a loss of $0.15 to earnings of $0.05 under GAAP. The gap shows the effect of the pension item on comparisons between the two profitability measures, while operating outlook figures remain reported separately.
Chief Executive John Diez said the strong results reflected execution of strategic initiatives and improved performance in used vehicle sales and rental. He added that freight market conditions improved during the quarter, describing the period as the eighth consecutive quarter of earnings-per-share growth. The company expects return on equity to exceed 18% in 2026 and strategic initiative benefits to top $70 million during the year. In the rental business, utilization of the rental fleet rose to 77%, compared with 70% a year earlier, even though the average fleet size was 12% smaller. The company’s results statement linked these indicators to earnings growth, improved utilization, and vehicle sales and rental performance.
Free cash flow was $992 million for the nine months ended September 30, 2026, compared with $496 million in the corresponding period of 2025. Ryder attributed the improvement mainly to lower cash capital expenditures and higher cash generated from operating activities. The company kept its fiscal 2026 free cash flow outlook at $700–$800 million and maintained its outlook for net cash from continuing operating activities at $2.6 billion. This guidance places the annual cash flow outlook alongside higher earnings and updated return expectations. Free cash flow, like adjusted earnings per share, is a non-GAAP measure.
Among analysts, Stephens raised its price target on Ryder to $305 from $280 on October 23, 2026, while maintaining an Overweight rating. The firm said about $40 million of a roughly $250 million cyclical opportunity was now included in Ryder’s 2026 outlook, with about $20 million expected in the fourth quarter. Stephens linked the improved outlook to a recovery in used vehicle sales and rental, expected additions to the core rental fleet in 2027, and a near-term increase in the rental fleet in the fourth quarter of 2026. Stephens acknowledged that its earlier forecast cut ahead of the third-quarter results, based on the view that the recovery would take longer, was a misjudgment. JPMorgan had raised its rating on October 5 from Neutral to Overweight and set a price target of $298, up from $296, citing a shift in the business mix toward less asset-intensive contractual revenue.
Ryder shares closed at $240.31 on October 21 and then at $265.53 on October 22, according to EL7 data. Alongside its updated outlook, the company said it had raised its planned annual investment in the rental fleet to $500 million, an increase of $300 million from its previous outlook. Diez said the spending is intended to enable the company to meet higher rental demand it expects in 2027. The increase in the fleet, the company said, prepares it early for that demand, while it continues to expect operating revenue growth of 3% for the year. Fourth-quarter expectations include adjusted earnings per share of $4.25 to $4.45, alongside an estimate of noncash pension settlement charges under GAAP.