Intel stock spikes after report of possible US government stake
On Thursday, Benchmark analysts reaffirmed their Buy rating and maintained a $130 price target on XPO (NYSE: XPO) stock, which currently trades at $117.82. The decision follows the company’s quarter-to-date (QTD) less-than-truckload (LTL) operating data for the second quarter, which aligns with the analysts’ forecasts for volume and operating ratio (OR) improvements. According to InvestingPro data, analyst targets range from $85 to $152, with a strong consensus recommendation of 1.62 (Buy).
The analysts noted that while the company does not disclose QTD revenue per hundredweight excluding fuel, discussions with management suggest it might fall slightly below the projected 6.8% year-over-year growth. This is attributed to higher-than-expected shipment weights, which nonetheless offer a boost to revenue per shipment. April and May tonnage figures, showing year-over-year declines of 5.5% and 5.7% respectively, align with typical seasonal patterns. The company has maintained stable operations, generating $8 billion in revenue over the last twelve months with an EBITDA of $1.2 billion.
Despite a slight decrease in diesel prices potentially affecting the fuel surcharge, XPO’s QTD volume growth surpassed that of ODFL, driven by continued growth in its local account business. The company’s focus on prioritizing pricing over volume to enhance OR has been effective this quarter, supporting the guidance for a 250-300 basis point sequential LTL OR improvement, estimated around 83%. InvestingPro analysis reveals 11 analysts have revised their earnings expectations downward for the upcoming period, though the company maintains a Fair Value rating.
Benchmark analysts emphasized the importance of XPO’s strategic focus on pricing as crucial to their investment thesis. They plan to revisit their estimates in a forthcoming second-quarter preview note. The firm’s price target for XPO remains unchanged at $130. With a beta of 1.74, investors should note the stock’s higher volatility compared to the market. For deeper insights into XPO’s valuation and performance metrics, access the comprehensive Pro Research Report available on InvestingPro.
In other recent news, XPO Logistics (NYSE:XPO) reported its first-quarter 2025 earnings, with adjusted diluted earnings per share (EPS) of $0.73, surpassing analyst expectations of $0.68. However, the company’s revenue fell short, reaching $1.95 billion against a projected $1.98 billion. Despite the revenue miss, XPO demonstrated resilience, with operating income rising 9% year-over-year to $151 million and net income increasing 3% to $69 million. Stifel analysts adjusted their price target for XPO to $135 from $142 while maintaining a Buy rating, citing the company’s margin expansion and strategic initiatives. Similarly, BMO Capital Markets reduced its price target to $145 from $165 but upheld an Outperform rating, highlighting XPO’s improvements in revenue quality and service. BofA Securities also lowered its price target to $119 from $131, maintaining a Buy rating, and noted XPO’s progress in closing the margin gap with industry peers. XPO’s management continues to focus on long-term earnings growth through cost and revenue initiatives, despite a challenging freight market.
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