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On Monday, Barclays (LON:BARC) analysts initiated coverage on Landstar System (NASDAQ: NASDAQ:LSTR) with an Equalweight rating and a price target of $145.00. The analysts highlighted Landstar’s unique position as a transportation provider, emphasizing its potential to benefit from a possible freight market recovery. According to InvestingPro data, the company maintains a strong financial position with more cash than debt and has consistently maintained dividend payments for 21 consecutive years.
Barclays analysts noted that Landstar could capitalize on improved market conditions, particularly if the company manages to regain its volume outperformance. They expect a rebound in the transportation sector, driven by a recovery in demand and a reduction in truck capacity. The stock has experienced a 17% decline year-to-date, and InvestingPro’s Fair Value analysis suggests the stock is currently fairly valued.
The analysts pointed out Landstar’s hybrid brokerage model, which they believe positions the company well in an improving rate environment. They cited the company’s significant business volume in spot and transactional markets, along with its approximately 40% fixed transportation cost base, as advantageous factors.
Despite the stock trading in line with peers and historical levels, the analysts maintained an Equalweight rating. They believe that Landstar’s management has strategically positioned the company to potentially benefit from higher trucking rates in the coming year.
In other recent news, Landstar System Inc. reported its first-quarter 2025 financial results, revealing a mixed performance. The company posted an earnings per share (EPS) of $0.85, falling short of the projected $0.94, but exceeded revenue expectations with $1.15 billion, surpassing the forecasted $1.13 billion. This quarter’s results included a $0.10 charge related to a supply chain fraud, which was significantly lower than initial estimates. Despite these challenges, Landstar’s heavy haul services showed a strong 6% revenue increase. Meanwhile, Benchmark analysts maintained a Hold rating on the company’s stock, citing its resilience amid industry challenges. Stifel analysts also maintained a Hold rating but adjusted the stock price target from $147 to $140, considering the company’s operational efficiency and current valuation. Evercore ISI made a slight adjustment to Landstar’s price target, bringing it down to $136 while maintaining an In Line rating. Additionally, during its annual meeting, Landstar’s shareholders voted on board elections and executive compensation, with the latter not receiving approval, indicating shareholder disapproval.
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