Expeditors International Faces Rough Waters in Logistics Market
Seattle-based Expeditors International of Washington, Inc. (EXPD) is a prominent logistics provider, managing global logistics for air and ocean freight. With a market cap of $16.6 billion, the company has been experiencing significant challenges lately.
Stock Performance Falls Short of Market Gains
Over the past year, Expeditors has struggled compared to the broader market. In 2024, EXPD stock prices dropped by 6.5%, while gaining only 1.2% over the last year. This contrasts sharply with the S&P 500 Index’s impressive increases of 24.1% year-to-date and 30.1% over the past 52 weeks.
Underperformance Within the Logistics Sector
Focusing on sector performance, Expeditors lagged behind the ProShares Supply Chain Logistics ETF (SUPL), which saw gains of 2% in 2024 and 9.4% over the past year.
Recent Earnings Reveal Challenges and Recovery Efforts
The firm faced a rocky start to 2024, with stock prices dropping 6.9% post-FY 2023 earnings announcement on February 20. The results were disappointing: a 45.5% decline in total revenues and a 44.5% decrease in net earnings shattered investor confidence.
Fortunately, there are signs of recovery. The stock rose 1.4% following the Q3 2024 earnings report on November 5. For the quarter, total revenues rebounded approximately 37% year-over-year to $3 billion. Net earnings saw a 34% increase to $229.6 million, and the adjusted EPS of $1.63 exceeded analysts’ expectations by 22.6%, offering a glimmer of hope to investors.
Future Expectations and Analyst Ratings
For the upcoming fiscal year ending in December, analysts project a 7.2% growth in adjusted EPS to $5.37. The company’s ability to meet or exceed analyst estimates has been variable, surpassing expectations in three of the last four quarters, while missing once.
The overall consensus on EXPD stock is “Moderate Sell.” Among the 14 analysts tracking the stock, eight recommend “Hold,” while six suggest a “Strong Sell” rating.
Shifting Analyst Ratings Indicate Caution
This current outlook is notably bearish when compared to three months ago, when only four analysts recommended a “Strong Sell.”
On November 11, Morgan Stanley (MS) analyst Ravi Shanker reiterated a “Sell” rating, setting a price target of $86. Although EXPD currently trades above the average price target of $116.77, the highest target set by analysts at $131 suggests a potential upside of 10.1% from current levels.
On the date of publication, Aditya Sarawgi did not hold any positions in the securities mentioned in this article. All information and data provided are solely for informational purposes. For additional details, please refer to the Barchart Disclosure Policy.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
