The Dow Jones Transportation Average rose on Wednesday to address a weakness in the broader stock market, led by rising shares of Expeditors International of Washington Inc. after the air and shipping company increased its plans to buy back dividends and shares.
The rally of freight forwarders helped offset the sell-off of shares of Avis Budget Group Inc., which matched the results of car rental companies for the first quarter.
rose 0.4%, with 12 of the 20 components gaining an advantage, and its cognate index, the Dow Jones industrial average
decreased by 7 points, or less than 0.1%.
Also, the S&P 500 index
decreased by 0.3% and the Nasdaq Composite
decreased by 1.0%.
Stocks of freight forwarders
rose 6.1% to a three-month high in southern trading to boost the Dow’s growth rate. This was the highest percentage since March 24, 2020, it grew by 12.9%.
The stock price rise of $ 6.23 on Wednesday added about 38 points to the Dow’s rise.
The company announced late Tuesday a six-month cash dividend of 67 cents a share compared to a previous payment of 58 cents a share. The new dividends are payable on June 15 to shareholders registered on June 1.
Based on the current share price, the new annual dividend rate assumes a dividend yield of 1.23%, which is compared to the estimated yield for the S&P 500 index
The company has also revealed a change in its “Discretionary Share Repurchase Plan” that now allows it to repurchase enough shares to reduce the number of shares outstanding to 150 million shares compared to the previous permit by 160 million shares.
According to the company’s annual report, with about 167.4 million shares outstanding as of March 8, the company could spend about $ 1.9 billion to reduce the number to $ 150.0 million at current prices.
The company said the number of shares it could repurchase could increase if the number of shares outstanding increased.
Dividend and buyout announcements appeared a day after the company reported profit and revenue for the first quarter which exceeded expectations, according to FactSet, as the increase in prices offset compared to last year a decrease in air tonnage and the volume of ocean containers.
Meanwhile, shares of Avis Budget
by 4.1% in mid-day trading to boost the Dow’s losers rate, reversal and previous gains by as much as 5.0%. A $ 11.66 drop in stock price reduced Dow transports ’price by about 71 points.
Early profits followed the campaign The first quarter report, released late Tuesday, in which Avis made a profit that was almost three times higher than expected, as revenue jumped 77% with rising prices and volumes.
Elsewhere, all six components of Dow transports traded lower, as a result of falling shares of JetBlue Airways Corp. by 2.7%.
Other airlines include American Airlines Group Inc.
decreased by 1.6%, Delta Air Lines Inc.
decreased by 1.5%, and United Airlines Holdings Inc.
Other major gains for Dow transports were shares in transportation management provider Landstar System Inc.
which grew 1.6%, rail operator Norfolk Southern Corp.
who received 1.5% and trucker JB Hunt Transport Services Inc. JBHTwhich grew by 1.4%.