Marten Transport (Nasdaq:MRTN) has been downgraded by TheStreet Ratings from buy to hold. The company’s strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and revenue growth. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and poor profit margins.
MARTEN TRANSPORT LTD has improved earnings per share by 21.4% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, MARTEN TRANSPORT LTD increased its bottom line by earning $1.11 versus $0.90 in the prior year. This year, the market expects an improvement in earnings ($1.32 versus $1.11).
The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Road & Rail industry average. The net income increased by 22.4% when compared to the same quarter one year prior, going from $6.19 million to $7.58 million.
The gross profit margin for MARTEN TRANSPORT LTD is rather low; currently it is at 17.30%. Regardless of MRTN’s low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, MRTN’s net profit margin of 4.80% is significantly lower than the same period one year prior. MRTN has underperformed the S&P 500 Index, declining 17.94% from its price level of one year ago. Looking ahead, we do not see anything in this company’s numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
Marten Transport, Ltd. operates as a temperature-sensitive truckload carrier in the United States, Canada, and Mexico. It offers protective service transportation and distribution of time and temperature sensitive materials and general commodities. The company has a P/E ratio of 14.3, above the average transportation industry P/E ratio of 14.1 and below the S&P 500 P/E ratio of 17.7. Marten Transport has a market cap of $383.8 million and is part of the services sector and transportation industry. Shares are down 5.1% year to date as of the close of trading on Friday.