This month’s Macro examines March and April data. As shown on Slide 8, freight vols on avg. declined 2% y/y in March and are tracking up less than 1% y/y based on preliminary April data after growing close to 3% the 1st two months of the year. Moreover, our proprietary Seasonal Freight Index (Slide 7) has dipped back below 50 the past 2 months after accelerating sharply late last year and early this year.
This weekly report presents the most recent views we are hearing from industry insiders and summarizes the research of Wolfe Trahan. Included are (1) key takeaways, selected shipper comments; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight & logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
LSTR reported flat y/y EPS, in line with Cons. and $0.01 below our expectations. Gross rev. declined 3% y/y and EBIT grew 1%, both worse than flat and +6% during 4Q. Gross rev. badly missed our expectation, but OR was 10bp better than our model. LSTR is continuing to see weak rev. trends in April and mgmt guided to 2Q EPS of $0.68-$0.73, down 7% y/y at the midpoint and 9% below prior Cons.
Transports Have Little Direct Government Exposure, But Sequestration Still Likely to Have Modest Negative Impact on Freight Volumes. We estimate AAWW and WAB have the most direct exposure to the U.S. gov’t at 30% and 20% of total rev., respectively. We suspect FDX and UPS also likely have higher-end gov’t exposure among the transports, but nobody else has more than 5% direct rev. exposure. Still, freight vols will likely be negatively impacted by sequestration, due in part to customs delays at major ports and the Canadian and Mexican borders.
This weekly report presents the most recent views we are hearing from industry insiders and summarizes the research of Wolfe Trahan. Included are (1) key takeaways, selected shipper comments; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight & logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
This weekly report presents the most recent views we are hearing from industry insiders and summarizes the research of Wolfe Trahan. Included are (1) key takeaways, selected shipper comments; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight & logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
This weekly report presents the most recent views we are hearing from industry insiders and summarizes the research of Wolfe Trahan. Included are (1) key takeaways, selected shipper comments; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight & logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
This weekly report presents the most recent views we are hearing from industry insiders and summarizes the research of Wolfe Trahan. Included are (1) key takeaways, selected shipper comments; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight & logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.
Excluding a large tax benefit, LSTR reported 3% below Cons. and 4% below our expectations on Thurs. morning. While LSTR is seeing muted volume and pricing trends to start the year, we expect rev. momentum to build throughout the year given improving housing demand, expected rebuilding efforts post Sandy and the extended wind energy tax credits, which should each also help flatbed pricing. However, we see risk to BCO vols as noted above and LSTR’s valuation is less attractive than last qtr. with estimates likely to come down in the near term and its recent stock outperformance.
This weekly report presents the most recent views we are hearing from industry insiders and summarizes the research of Wolfe Trahan. Included are (1) key takeaways, selected shipper comments; (2) notices of upcoming industry events; (3) key takeaways from some of our notes from the past week; (4) recent stock performance for our transport universe; (5) updated comparison tables for the airfreight & logistics group, railroads, and trucking; and (6) fuel trends for West Texas Crude Oil, On-highway diesel, Rail diesel, and Jet fuel.