The transportation sector literally helps to drive the U.S. economy forward. According to the U.S. Department of Transportation, the transportation and warehouse sector made up of planes, trains and automobiles contributed $1.7 trillion to the economy in 2022 (latest statistics available). That equates to 6.7% of the nation’s gross domestic product (GDP). Employment in transportation and warehousing stood at 6.7 million workers in 2022, up more than 8% from the previous year.
Whether it is autoworkers, truck drivers, aircraft mechanics, or railroad engineers, transportation plays a pivotal role when it comes to employment and the economy. Within the stock market, transportation stocks are moving in the right direction. Over the past 12 months, the S&P Transportation Index has gained 7% after suffering a downturn during the pandemic and bear market of 2022. As shares move higher, now is a good time for investors to purchase. Here are the top three transportation stocks to buy in April 2024.
Ford Motor Co. (F)
Ford Motor Co. (NYSE:F) just reported very strong first-quarter earnings, driven by sales of its commercial vehicles. The Detroit automaker announced earnings per share (EPS) of 49 cents compared to 42 cents that was expected by analysts. The company’s Q1 revenue totaled $39.89 billion versus the $40.10 billion that was forecast on Wall Street. Sales were up 3% from a year earlier. Ford’s traditional business, known as Ford Blue, reported earnings of $905 million, down 66% from a year ago. However, the commercial business saw sales rise 120% year over year to $3.01 billion.
The decline in Ford Blue was related to the launch of the company’s new F-150 pick-up tuck, which faced some delays. Management said that strong commercial vehicle sales offset losses from the traditional and electric vehicle business units. Looking ahead, Ford maintained its 2024 earnings guidance, saying it expects a profit of $10 billion to $12 billion this year. The automaker reiterated that it also expects its electric vehicle business to lose $5 billion to $5.50 billion in 2024. However, Ford remains on track to take $2 billion in costs out of the business this year. F stock has risen 5% so far in 2024.
GE Aerospace (GE)
GE Aerospace (NYSE:GE) has reported its first earnings report since hiving off its healthcare and energy businesses into separate publicly traded companies, and the results were quite good. The company, which mostly produces aircraft engines, announced Q1 EPS of 82 cents, which beat consensus estimates of 65 cents. Revenue totaled $15.2 billion, which was slightly below Wall Street estimates of $15.3 billion. The aerospace unit reported an operating profit of $1.5 billion on sales of $8.1 billion for Q1. Aerospace orders came in at $11 billion, up 34% from a year earlier.
In terms of guidance, GE Aerospace said that it expects a 2024 operating profit of $6.2 billion to $6.6 billion. That’s up from a previous outlook of $6 billion to $6.5 billion. Beyond its earnings print, GE Aerospace also recently hiked its quarterly dividend payment to stockholders by 250%. The company now pays a quarterly dividend of 28 cents per share, up from 8 cents previously. In addition to the dividend, GE stock has also been growing, having gained 112% in the last 12 months, including a 59% increase this year.
General Motors (GM)
Detroit automaker and Ford rival General Motors (NYSE:GM) also looks like a buy after its Q1 print. The company raised its 2024 guidance after topping Wall Street expectations with its latest earnings. GM reported earnings per share of $2.62 versus $2.15 which was expected among analysts, and revenue of $43.01 billion compared to the $41.92 billion which was estimated. The vehicle manufacturer lifted its guidance, saying it now expects earnings of $9 to $10 a share for all of this year.
Analysts and investors also liked that GM raised its forecast for free cash flow this year to a range of $8.50 billion to $10.50 billion. Strong North American sales, particularly of pick-up trucks, were largely responsible for the Q1 beat and guidance raise, said GM executives. The company also remains focused on electric vehicles with plans to produce between 200,000 and 300,000 of them this year. Boosted by the strong print and outlook, GM stock has been up by 26% year-to-date.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.