Heartland Express Earnings Preview

After beating estimates last quarter by $0.04, Heartland Express (Nasdaq: HTLD  ) has set the standard for itself. The company will unveil its latest earnings on Monday. Heartland Express is a short-to-medium-haul truckload carrier of general commodities. It provides transportation service to shippers, using late-model equipment and a combined fleet of company-owned and owner-operator tractors.

What analysts say:
 

• Buy, sell, or hold?: Analysts think investors should stand pat on Heartland Express with nine of 16 analysts rating it hold. Analysts like Heartland Express better than competitor Knight Transportation overall. Six out of 21 analysts rate Knight Transportation a buy compared to five of 16 for Heartland Express. While analysts still rate the stock a Hold, they are a little more optimistic about it compared to three months ago.
• Revenue forecasts: On average, analysts predict $140.6 million in revenue this quarter. That would represent a rise of 10.5% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.21 per share. Estimates range from $0.19 to $0.27.

What our community says:
CAPS All-Stars are solidly behind the stock with 84.4% assigning it an outperform rating. The community at large backs the All-Stars with 88.6% awarding it a rating of outperform. Fools are bullish on Heartland Express, though the message boards have been quiet lately with only 32 posts in the past 30 days. Heartland Express' bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Heartland Express' profit has risen year over year by an average of 32.6% over the past five quarters. Revenue has now gone up for three straight quarters. The company's gross margin shrank by 7.2 percentage points in the last quarter. Revenue rose 7.7% while cost of sales rose 33.9% to $50.5 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q2	Q1	Q4	Q3
Gross Margin	63.2%	63.8%	68.4%	69.3%
Operating Margin	15.3%	14.1%	16.8%	16.6%
Net Margin	16.4%	11.7%	11.9%	14.4%

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