We just heard from over 75 public and private transportation companies at our Global Transport Conference last week, and today’s audio brief focuses on our top 10 takeaways for the freight transport stocks.
Overall, freight is telling a consistent story about decent but unexciting volume and general economic growth. Within that trend of consistency, we’ve just left a seasonal lull in March and April, and freight volumes are seasonally feeling much stronger the past 2 weeks with the late start to Spring, and this should be positive for near-term transport sentiment. We think KNX and SWFT (the latter not at our conference) are the best ways to play a near-term improvement in demand, and lower diesel fuel prices in 2Q should also help TL earnings in the near term.
The biggest takeaway from our conference is that airfreight volumes have started to improve again in April and May. Combined with lower ocean spot rates, we think the recent solid momentum for EXPD’s stock should continue, and stronger airfreight also seems positive for FDX and UTIW.
Among the rails, trends clearly seem more favorable in the West than the East with respect to coal, and we’re incrementally more positive on UNP and CP out of our conference.
We discuss these items and more, including an appendix with additional takeaways, in today’s audio brief and attached slides.