Sprouts Farmers Market closes $600 million revolving credit facility
Investing.com-- Stifel analysts have upgraded CH Robinson Worldwide Inc (NASDAQ:CHRW) to "Buy" from "Hold", citing continued signs of fundamental improvements despite a challenging freight market.
The brokerage also reaffirmed its price target at $113, highlighting margin expansion and structural cost efficiencies as key drivers of long-term upside.
The company reported fourth-quarter adjusted earnings per share (EPS) of $1.21, surpassing Stifel and consensus estimates of $1.11.
While earnings were supported by lower interest expenses and taxes, analysts pointed to sequential profitability gains despite seasonally higher purchased transportation (PT) costs.
Stifel believes C.H. Robinson’s focus on leveraging its scale, technology, and operational efficiency will allow it to drive sustained margin expansion, even if freight demand remains sluggish in the near term.
North American Surface Transportation (NAST), which accounts for 59% of net revenue and 71% of adjusted EBIT, showed resilience in the fourth quarter, analysts said.
While total segment revenue declined 6.6% year-over-year due to weak truckload (TL) demand and lower rates, gross margins expanded. TL volumes fell 6.5% year-over-year, offset by a 2.5% increase in less-than-truckload (LTL) shipments, analysts added.
Stifel noted that operating expenses declined approximately 5% year-over-year, with the company’s leaner model driving an improved operating ratio of 95.2%, ahead of its 95.7% forecast.
Stifel analysts believe the company’s ongoing productivity improvements, cost controls, and automation initiatives position it well for the next freight cycle.
With shares recently trading around $100, Stifel views the risk/reward profile as favorable, maintaining its 2025 and 2026 EPS estimates at $5.00 and $5.65, respectively.