Jefferies reveals Knight-Swift stock most favored by hedge funds

Investing.com - Jefferies has released its proprietary analysis of hedge fund positions in the transportation and logistics sector, revealing Knight-Swift Transportation (NYSE:KNX) as the most favored stock among hedge funds at the end of April. For deeper insights into transportation stocks and exclusive analysis, InvestingPro subscribers can access comprehensive research reports covering over 1,400 US equities.

The analysis, which covers 700 hedge funds with positions exceeding $600 billion, shows funds were net long Knight-Swift, CSX Corporation (NASDAQ:CSX), and FedEx (NYSE:FDX) relative to the Russell 3000 benchmark. Conversely, Old Dominion Freight Line (NASDAQ:ODFL), XPO (NYSE:XPO), and Union Pacific (NYSE:UNP) were the most shorted stocks in the sector. According to InvestingPro data, ODFL trades at a P/E ratio of 32.26 and maintains strong financial health with more cash than debt on its balance sheet. The company has consistently raised its dividend for 8 consecutive years, though 12 analysts have recently revised their earnings expectations downward.

From March to April, hedge funds became more bullish on CSX (active weight up 30 basis points), UPS (active weight up 21 basis points), and Knight-Swift (active weight up 20 basis points). During the same period, funds turned more bearish on XPO (active weight down 71 basis points) and Old Dominion (active weight down 66 basis points).

Knight-Swift maintained its position as the most favored transportation stock with an active weight of +43 basis points, followed by CSX at +40 basis points and FedEx at +22 basis points. Old Dominion remained the most shorted with an active weight of -151 basis points, followed by XPO at -107 basis points.

The Jefferies report noted that many of the most bullish and bearish positions in March saw continuation in April, with stocks like CSX, UPS, Norfolk Southern (NYSE:NSC), and J.B. Hunt (NASDAQ:JBHT) experiencing further inflows after seeing inflows in March. For comprehensive analysis of these transportation stocks and more, including Fair Value estimates and financial health scores, visit InvestingPro.

In other recent news, Old Dominion Freight Line has reported a decrease in less-than-truckload (LTL) revenue per day for May, with a 5.8% drop compared to the previous year. This decline was primarily due to an 8.4% reduction in LTL tons per day, alongside a 6.8% drop in daily shipments and a 1.9% decrease in weight per shipment. Despite these challenges, Old Dominion noted a 3.2% increase in LTL revenue per hundredweight, rising to 5.6% when excluding fuel surcharges. Benchmark maintains a Hold rating on Old Dominion, noting volume pressures but acknowledging solid revenue quality with mid-single-digit growth per hundredweight. Meanwhile, Goldman Sachs upgraded Old Dominion’s stock rating to Buy, raising the price target to $200, citing a positive outlook for potential growth. BofA Securities, however, lowered its price target from $183 to $171 due to a revenue drop, maintaining a Neutral rating. The company is adjusting its fiscal year 2025 capital expenditures from $575 million to $450 million amid market uncertainties, aiming to defer real estate and equipment spending.

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