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Key Takeaways from XPO Logistics’ 3Q17 Results

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Key Takeaways from XPO Logistics’ 3Q17 Results PART 1 OF 7

XPO Logistics Beat 3Q17 Earnings, Stock at All-Time High

XPO’s 3Q17 earnings

An emerging road transport giant in the US, XPO Logistics (XPO) announced its 3Q17 earnings on November 1, 2017, after the markets closed. The company held its conference call with the investor community on November 2 to discuss the results.

XPO surpassed the Thomson Reuters–surveyed analysts’ adjusted EPS (earnings per share) of $0.57 by 4.2%. In 3Q17, XPO reported adjusted EPS of $0.59, up 44% from $0.41 in 3Q16.

XPO Logistics Beat 3Q17 Earnings, Stock at All-Time High

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XPO’s stock price reaction

With three major acquisitions in the last few years, XPO Logistics (XPO) has catapulted into a major global logistics company. The company is considering going for strategic acquisitions of $8.0 billion over the next few quarters. Investors interested in trucking (IYJ) industry stocks could watch XPO in the near term.

After the announcement of its 3Q17 results, XPO stock started rising and touched a record high. On November 7, 2017, XPO stock traded at an all-time high of $74.80 per share to close at $73.60 on the same day. In 2017, XPO has returned a whopping 70.5% to investors.

Let’s see how its peer group performed during the same period:

  • C.H. Robinson Worldwide (CHRW): rose 9.1%
  • Old Dominion Freight Line (ODFL): rose 41.3%
  • United Parcel Service (UPS): fell 0.6%
  • SAIA (SAIA): rose 44.0%
  • YRC Worldwide (YRCW): rose 2.0%
  • J.B. Hunt Transport Services (JBHT): rose 10.0%

Management outlook

XPO’s chairman and CEO, Bradley Jacobs noted, “In the third quarter, we generated the highest revenue, net income and cash flow of any quarter in our history, and our $370.0 million of adjusted EBITDA beat expectations.

“We benefited from positive market dynamics, including e-commerce demand for contract logistics and last mile, growth in intermodal, and a brokerage market that is trending in our favor. Our diversification is yielding results.”

Jacobs added, “We’re executing major initiatives around pricing, utilization and sales productivity to capitalize on the large opportunities at hand. Our sales force has closed $2.1 billion of new business through September, up 49%, and our pipeline continues to exceed $3 billion globally.”

In this 3Q17 post-earnings series, we’ll focus on XPO’s segmental revenues. We’ll conclude the series with analysts’ opinions on the company and its peers.

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