In a report released yesterday, Scott Schneeberger from Oppenheimer maintained a Buy rating on XPO Logistics (XPO), with a price target of $96. The company’s shares closed on Friday at $51.55, close to its 52-week low of $41.05.
Schneeberger commented:
“Despite a tough run of negative sentiment, XPO’s fundamental story remains little changed. We’re mindful of slowing economic growth, but view 2017-2018 new business wins ramping/the probability of incremental wins likely sufficient to drive solid 2019 organic growth. We view XPO’s recently introduced 12%-15% 2019 adjusted EBITDA growth guidance as achievable. Although recently introduced 2019 FCF guidance was below prior expectations, the drivers didn’t signal significant fundamental business deterioration. Prevailing industry multiple contraction prompts us to modify our target to $96 from $114 per our sum-of-the-parts valuation assessment. However, we see substantial upside opportunity as XPO is now trading at just 6.1x EV/EBITDA our maintained (organic) $1.8B 2019E adjusted EBITDA. With leverage approaching 2x at 2018E-end, incremental mid-sized (accretive) M&A could be beneficial.”
According to TipRanks.com, Schneeberger is a 5-star analyst with an average return of 7.7% and a 61.8% success rate. Schneeberger covers the Services sector, focusing on stocks such as Service Corp International, General Finance, and United Parcel.
The word on The Street in general, suggests a Strong Buy analyst consensus rating for XPO Logistics with a $100.33 average price target, which is a 94.6% upside from current levels. In a report issued on December 12, SunTrust Robinson also initiated coverage with a Buy rating on the stock with a $83 price target.
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XPO Logistics’ market cap is currently $6.54B and has a P/E ratio of 13.98. The company has a Price to Book ratio of 1.58.
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XPO Logistics, Inc. engages in the provision of supply chain solutions. It operates through the Transportation and Logistics segments. The Transportation segment includes freight brokerage, last mile, less-than-truckload, full truck load, and global forwarding services.
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