JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
On Wednesday, Citi analyst Ariel Rosa updated RXO, Inc. (NYSE: RXO) price target, increasing it to $18.00 from the previous $15.00, while maintaining a Neutral stance on the company’s shares. The adjustment follows a recent meeting with RXO CEO Drew Wilkerson and CSO Jared Weisfeld, where discussions centered on the company’s performance, industry dynamics, and long-term prospects. According to InvestingPro data, RXO’s stock has shown strong momentum over the last month, despite trading at relatively high EBIT and EBITDA multiples.
During the meeting on Monday, RXO’s management addressed the mixed opinions surrounding the company’s stock. Some investors have raised concerns over the company’s modest earnings per share (EPS) and negligible free cash flow (FCF), which they see as a major issue. These concerns are reflected in InvestingPro data, which shows the company operating with moderate debt levels and currently unprofitable over the last twelve months. On the other hand, supporters of the company highlight the potential synergies from its recent Coyote acquisition and the significant earnings upside that could result from an eventual cyclical turnaround in the truckload sector.
Despite acknowledging that recent outcomes have fallen short of expectations due to macroeconomic pressures, including industrial weakness, RXO’s leadership conveyed a positive outlook. The company’s executives are optimistic about the progress being made with the integration of Coyote and the substantial potential for earnings and FCF growth in the medium to long term.
RXO’s management expressed confidence in their ability to achieve mid-cycle mid-single-digit margins, which would imply an adjusted EBITDA of over $350 million and FCF exceeding $200 million. These targets reflect the company’s strategic focus on improving financial performance and capitalizing on market opportunities as they arise.
In other recent news, RXO Inc reported its Q1 2025 earnings, which fell short of expectations. The company announced an earnings per share (EPS) of -$0.03, significantly below the forecasted $0.18, and generated a total revenue of $1.4 billion. Brokerage revenue made up 72% of the total, amounting to $1.1 billion. Despite the earnings miss, RXO achieved an adjusted EBITDA of $22 million, representing a 1.5% margin. Truist Securities recently adjusted its outlook on RXO, reducing the company’s price target from $19.00 to $18.00, but maintained a Buy rating. Analyst Lucas Servera from Truist expressed confidence in RXO’s long-term earnings potential, noting the company’s successful integration of technology and synergy realization. RXO’s strategic initiatives, including the completion of carrier migration and the implementation of its Comprehensive Outsourced Pricing Tool, are expected to enhance its operational efficiency. Additionally, RXO anticipates improvements in Q2, with adjusted EBITDA guidance ranging between $30-$40 million.
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