TDBNN has a headline that CJT missed estimates but the analyst reports don't seem to reflect that. So after being out for about 6 months, I'm now back in at the open. GLTA
August 13, 2024
Cargojet Inc.
Slightly better Q2; management outlook commentary encouraging
TSX: CJT | CAD 120.95 | Outperform | Price Target CAD 189.00
Sentiment: Positive
Our early take: CJT reported Q2 EBITDA that came in a touch ahead of consensus expectations. Overall, we view the results as positive to sentiment given that the company achieved solid volume growth (+5%) in Domestic despite weak Canadian consumer data points - suggestive of a strong ramp when macro improves. Further, we like the strong performance in Charter on the back of the recent Great Vision HK Express deal - especially impressive within the context of other transport players reporting results during Q2. Turning to the outlook, management referenced in the MD&A "early signals in the market...are indicating that there could be a strong finish to the year", which in our view prompted management to increase CJT's expected 2025 fleet to 42 aircraft to execute on potential eCommerce opportunities. Key is we see this as indicating upside to H2 and 2025 consensus estimates, and therefore expect results to be well received. Finally, we note that Cargojet increased its dividend by $0.0354 or 11.25% per share in line with our and consensus expectations.
Q2/24 highlights: Total revenue came in at $231MM vs. consensus $234MM (RBC: $233MM) and EBITDA of $79MM, a touch above consensus $78MM (RBC: $80MM). See Exhibit 1.
Conference call details
• August 14, 2024 at 8:30 A.M.
• Dial-in: 1 800 806 5484 pass code 854 9928#.