The Russia-Ukraine conflict has worsened global logistic bottlenecks so far this year, exacerbating inflation concerns. Furthermore, the resurgence of COVID-19 cases in China and attendant lockdowns have disrupted domestic and international logistics, increasing global transportation costs. However, demand for consumer goods remains strong, boosting the demand for logistics services globally.
The need to increase international trade and rapid technological advancements are projected to drive the logistics sector's long-term growth. According to Research and Markets, the global logistics market is estimated to grow at a 4.7% CAGR from 2022 to 2027.
Given this backdrop, Wall Street analysts expect beaten down yet fundamentally strong logistics stocks XPO Logistics, Inc. (XPO), Radiant Logistics, Inc. (RLGT), and Cryoport, Inc. (CYRX) to rally more than 65% in price in the near term.
XPO Logistics, Inc. (XPO)
XPO in Greenwich, Conn., provides freight transportation services in the United States, the rest of North America, France, the United Kingdom, the rest of Europe, and internationally. The company operates in two segments–North American LTL and Brokerage and Other Services.
On April 22, 2022, XPO introduced a carbon-offset shipping option for customers of its truck brokerage business in North America. This is designed to bring about sustainability in shipping activities by providing suitable alternatives for reducing carbon emissions.
XPO's revenue increased 14.4% year-over-year to $3.36 billion for the fourth quarter, ended Dec. 31, 2021. Its operating income came in at $174 million, up 13.7% year-over-year. Also, its EPS came in at $1.05, up 15.4% year-over-year.
Analysts expect XPO's revenue to grow 5.3% year-over-year to $13.48 billion in 2022. Its EPS is estimated to increase 52.4% per annum for the next five years. The stock has declined 26.1% year-to-date to close yesterday's trading session at $57.20. Wall Street analysts expect the stock to hit $96.29 in the near term, which indicates a potential 68.3% upside.
Radiant Logistics, Inc. (RLGT)
Bellevue, Wash.-based RLGT is a third-party logistics company that provides multi-modal transportation and logistics services primarily in the U.S. and Canada. The company offers domestic and international air and ocean freight forwarding services, and freight brokerage services.
On March 24, 2022, Bohn Crain, RLGT's Founder and CEO, said, "We are delighted to have been recognized as one of America's Most Trusted Companies. This type of recognition is a direct result of the dedication of our employees and operating partners across the network who continue to work tirelessly to deliver exceptional service and value in the face of the challenges of today's marketplace."
For its second fiscal quarter, ended Dec. 31, 2021, RLGT's revenues came in at $332.77 million, up 52.1% year-over-year. Its net income was $6.95 million, up 82.3% year-over-year, while its EPS came in at $0.14, up 100% year-over-year.
RLGT's revenue is expected to be $1.27 billion in 2022, representing a 43% year-over-year rise. The company's EPS is expected to increase 35.8% to $0.91 in 2022. It surpassed the Street’s EPS estimates in three of the trailing four quarters. The stock has declined 18.8% year-to-date to close yesterday's trading session at $5.92. Wall Street analysts expect the stock to hit $12.50 in price in the near term, which indicates a potential 111.2% upside.
Cryoport, Inc. (CYRX)
CYRX, a life sciences services company, provides temperature-controlled logistics solutions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The Irvine, Calif., company offers Cryoportal, a cloud-based logistics management platform, and CryoPort Express Shippers.
On April 18, 2022, CYRX acquired Cell&Co BioServices. Jerrell Shelton, CYRX's CEO, said, "Cell&Co will play a significant role in Cryoport Systems' development of its Global Supply Chain Network, designed to meet the needs of the growing Regenerative Medicine industry worldwide."
CYRX's total revenues increased 16.7% year-over-year to $56.44 million for the fourth quarter, ended Dec. 31, 2021. Its cash and cash equivalents came in at $139.10 million for the period ended Dec. 31, 2021, compared to $36.87 million for the period ended Dec. 31, 2020. And its total current assets came in at $693.52 million, compared to $147.16 million for the same period.
For its fiscal year 2023, analysts expect CYRX's revenue to be $322.80 million, representing a 24.8% year-over-year rise. Its EPS is estimated to increase 103.6% to $0.02 in 2023. The stock has declined 57.4% in price year-to-date to close yesterday's trading session at $25.21. Wall Street analysts expect the stock to hit $68.00 in the near term, which indicates a potential 169.7% upside.
XPO shares were trading at $54.68 per share on Tuesday afternoon, down $2.52 (-4.41%). Year-to-date, XPO has declined -29.38%, versus a -11.44% rise in the benchmark S&P 500 index during the same period.
About the Author: Riddhima Chakraborty
Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.
3 Beaten-Down Logistics Stocks Wall Street Loves StockNews.com
