C.H. Robinson’s North American Surface Transport Segment

C.H. Robinson Worldwide’s (CHRW) NAST (North American Surface Transport) segment provides truckload, LTL (less-than-truckload), and intermodal freight transportation services across North America. Revenue-wise, NAST is CHRW’s most important business vertical. In fiscal 2017, transportation revenue comprised ~91% of the company’s total revenue of $14.8 billion.

• Truckload services: CHRW has a robust truckload network in North America. The company has access to temperature-controlled and dry vans, flatbeds, and bulk capacity through its contracts with motor carriers, and matches customers’ requirements with suppliers’ capabilities through its proprietary platform, Navisphere.
• LTL transportation: CHRW has the world’s largest third-party LTL network. LTL transportation services ship any-size freight through contracts with motor carriers.
• Intermodal transportation services: CHRW has intermodal agreements with all Class 1 railroads and container owners in North America. Intermodal services transport freight through a combination of truck and rail networks. The company also owns ~1,500 containers and leases ~1,700 containers.

In the truckload and intermodal space, CHRW faces stiff competition from J.B. Hunt Transport (JBHT) and Old Dominion Freight Line (ODFL).

The iShares Transportation Average ETF (IYT) has an exposure of 4.5% to CHRW and 44.4% and 27.6%, respectively, to the airline and railroad sectors. IYT also invests 14.6% and 6.9% of its holdings in express delivery giants FedEx (FDX) and United Parcel Service (UPS), respectively. In the next part of this series, we’ll look at CHRW’s Global Forwarding segment.