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Investing.com - Stephens lowered its price target on Old Dominion Freight Line (NASDAQ:ODFL) to $174.00 from $186.00 on Thursday, while maintaining an Overweight rating on the stock. The stock, currently trading near its 52-week low of $144.50, has declined nearly 13% in the past week. According to InvestingPro data, eight analysts have recently revised their earnings expectations downward.
The price target reduction follows Old Dominion’s slight miss in its second-quarter 2025 results, where lighter tonnage could not be fully offset by continued cost controls. Despite challenges, the company maintains strong fundamentals with a healthy 39.8% gross margin and robust cash flows that adequately cover its minimal debt obligations.
Stephens reduced its forward tonnage estimates for the freight company and adjusted margin expectations lower based on the third-quarter outlook and volume deleverage in the network.
Despite steeper-than-expected tonnage declines, Old Dominion continues to achieve some of the highest yield growth in the industry, and its excess capacity should support strong incremental margins when volumes improve.
Stephens believes Old Dominion shares remain attractive over a longer time horizon and suggests using the current price decline as an opportunity to build positions in the stock.
In other recent news, Old Dominion Freight Line reported its second-quarter earnings for 2025, which fell slightly below analyst expectations. The company announced earnings per share of $1.27, missing the forecasted $1.29. Additionally, Old Dominion’s revenue came in at $1.41 billion, just shy of the anticipated $1.42 billion. This earnings report reflects a 15% year-over-year decline in earnings per share. BofA Securities responded by lowering its price target for Old Dominion Freight Line to $160 from $171, while maintaining a Neutral rating on the stock. The freight carrier’s operating income reached $358 million, which was $3 million below BofA’s target. These developments underscore the challenges Old Dominion is facing in meeting market expectations.
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