Yahoo Finance 4 Best Transportation Stocks to Invest In For 2024 — and 3 to Avoid
Most people think of AutoZone as the place you take your car when the engine light comes on.
Check Out: 10 Valuable Stocks That Could Be the Next Apple or Amazon
Read Next: How To Get $340 Per Year in Cash Back on Gas and Other Things You Already Buy
But did you know that AutoZone and other companies in the transportation sector could present optimal investment opportunities?
GOBanking Rates uncovered the four best transportation stocks to invest in for 2024 — and three to avoid.
Wealthy people know the best money secrets. Learn how to copy them.
Why Transportation Stocks Matter
We’ll always need trains, planes, and automobiles to move goods, services, and people around the world. The consistent demand for transportation services makes their performance crucial for investors, said Dean Pernas, co-founder of Pernas Research, an investment research firm.
“The performance of the transportation sector is often seen as a barometer of the overall economy,” Pernas said. “Innovations in transportation, such as electric vehicles, autonomous driving, and advancements in logistics technology create investment opportunities, and drive interest in the sector.”
Before investing in transportation stocks, make sure you evaluate the company’s fixed and operating costs; whether the company keeps its long-term debt at manageable levels; and competitive strength.
4 Best Transportation Stocks
AutoZone (Nasdaq: AZO) — The car parts dealer has become a Wall Street darling. The company “reported earnings per share (EPS of $36.69 and revenue of $4.24 billion for Q1 of 2024. The stock is up almost 9% this year and swelled 165% over the past five years,” according to Nasdaq. The company is experiencing growth because people are holding on to their cars longer to avoid long waits for expensive new models.
Share Price as of June 12: $2,820
Market Cap: $48.1 billion
Union Pacific Corporation (Nasdaq: UNP) — Union Pacific is one of the largest railroad companies in the U.S., with a vast network and strong financial performance. According to Pernas, the company has shown resilience in various economic conditions and continues to invest in technology and infrastructure improvements.
“The replacement cost of these assets is almost incalculable,” he said.
Share Price as of June 12: $231.37
Market Cap: $138.2 billion
BYD (OTC: BYDDY) — Pernas said BYD is a “leader” in electric vehicles because the company continues to innovate and expand its product lineup.
“The push towards sustainable transportation and increasing EV adoption makes BYD a compelling investment,” Pernas said. “BYD produced and delivered over 1.86 million vehicles in 2023, almost the same amount as Tesla.”
Share Price as of June 12: $57.01
Market Cap: $32 billion
Copart (Nasdaq: CRPT) — Running an online auction and remarketing service for used cars and salvaged vehicles has become a big business for the company. It beat Wall Street’s consensus forecasts during fiscal Q3 financial results. Copart announced that its Q3 revenue totaled $1.13 billion and a 10% increase in sales from last year. The company’s stock increased 14% this year and has jumped 205% over the last five years.
Share Price as of June 12: $53.60
Market Cap: $51.9 billion
Transportation Stocks to Avoid
Some airline stocks are falling as a result of President Joe Biden’s new rules requiring airlines to provide automatic cash refunds to passengers who are owed money for circumstances beyond their control, like canceled flights.
JetBlue (Nasdaq: JBLU) — The airline warned investors about the possible impact of Biden’s administration on its 2024 revenue. However, JetBlue is besieged by high fuel costs, increasing labor costs, and rising operating costs. The company’s Q1 results declined compared to last year’s earnings. Accounting for nearly 94% of total revenue, passenger revenues declined to $12.60, resulting from air traffic control issues in the Northeast.
Share Price as of June 12: $5.72
Market Cap: $2 billion
American Airlines Group (Nasdaq: AAL) — American Airlines has struggled with high debt levels and operational inefficiencies. The competitive landscape and potential economic downturns could further negatively impact its performance, Pernas said.
Share Price as of June 12: $11.51
Market Cap: $7.5 billion
Airlines aren’t the only segment of the transportation sector to take a hit, Pernas has suggested.
Hertz Global Holdings (Nasdaq: HTZ) — The car rental industry faces uncertainties with the rise of ride-sharing services and potential economic slowdowns. Hertz has also experienced financial instability in recent years.
Share Price as of June 12: $3.54
Market Cap: $1.1 billion
“The rise of autonomous vehicles and ‘robo taxis’ does not bode well for the car rental industry,” Pernas said.
More From GOBankingRates
In Less Than a Decade, You Won't Be Able To Afford Homes in These 20 Arizona ZIP Codes
These 10 Used Cars Will Last Longer Than an Average New Vehicle
This article originally appeared on GOBankingRates.com: 4 Best Transportation Stocks to Invest In For 2024 — and 3 to Avoid
