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Old Dominion Freight Line, Inc. (ODFL), headquartered in Thomasville, North Carolina, is a top North American less-than-truckload (LTL) motor carrier. Valued at a market cap of $44.1 billion, it operates an extensive network of service centers across the continental United States and partners strategically to expand its LTL services throughout North America.
Shares of this leading trucking company have underperformed the broader market considerably over the past year. ODFL has gained marginally over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 27.8%. In 2024, ODFL stock is up marginally, while SPX is up 17.8% on a YTD basis.
Narrowing the focus, ODFL’s outperformance is also apparent when compared to the iShares U.S. Transportation ETF (IYT). The exchange-traded fund has gained about 6.9% over the past year.
Despite the weak price action over the past year, ODFL surged 19% in July, driven by stronger-than-expected Q2 earnings, according to S&P Global Market Intelligence. The company delivered an impressive per-share profit of $1.48, outpacing Wall Street's projections of $1.45. The company also reported $1.5 billion in revenue, perfectly aligning with market expectations.
For the current fiscal year, ending in December, analysts expect ODFL’s EPS to grow marginally to $5.68 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 19 analysts covering ODFL stock, the consensus is a “Hold,” a step down from “Moderate Buy” two months ago. That’s based on five “Strong Buy” ratings, one “Moderate Buys,” 11 “Holds,” and two “Strong Sells.”
This configuration is less bullish than two months ago, with six analysts suggesting a “Strong Buy.”
On Jul. 25, TD Cowen raised Old Dominion Freight Line's price target to $214 from $206 while maintaining a “Hold” rating. Despite strong Q2 results, Cowen lowered expectations for the second half of the year, mainly due to margin concerns, while watching for any signs of a rebound in industrial demand.
While ODFL currently trades above its mean price target of $197.83, the Street-high price target of $228 suggests an upside potential of 12.4%.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
