Transportation

Trucking & Less Than Truckload

 

Truckload
The truckload industry by Department of Transportation (DOT) definition is characterized by shipments of 10,000 pounds or more and is approximately $65 billion in size. Concentration within the industry is very fragmented with approximately 50,000 carriers, and labor tends to be predominately non-union. TL carriers transport trailer-load shipments bound for a single destination, and routes tend to be irregular with few terminals (used mainly for maintenance). There are several sub-categories including dry-van, flatbed, temperature-controlled, tanker, regional and expedited. Operations vary depending on length of haul, which falls into three service categories: long-haul (more than 1,000 miles), medium-haul (600-1,000 miles) and short-haul (less than 600 miles). Rates (a proxy for pricing) have not kept pace with inflation (CPI) over the last 15 years. Profitability is defined in terms of operating ratios (one minus operating margin) and tends to vary from 82% to 99%. Growth is usually a function of shipper-driven consolidation and conversion of private fleets.

Less-Than-Truckload
The less-than-truckload (LTL) industry provides transportation of partial-load shipments that go to one or more destinations or full trailer-load shipments going to multiple destinations. The LTL is a $39 billion industry and is comprised of two distinct segments, national LTL and regional LTL. The national LTL participants operate a "hub-and-spoke" network with an average length of haul of 1,200 to 1,400 miles. Growth is dependent on accelerated economic activity and competitor failures. The estimated size of the national LTL segment is $12 billion. The regional LTL segment is characterized by numerous carriers, typically non-union, that operate a modified hub-and-spoke network, with an average length of haul of 200 to 600 miles for most freight. Growth in this segment is dependent on consolidation within the marketplace, the shift toward more regionalized freight patterns by shippers, and general economic growth. The regional LTL segment is highly fragmented, with the top 20 participants accounting for roughly 50% of the estimated $27 billion market.

Managing Director:
Jack Waldo: Bio
 Associates:
Tyler Bozynski: Bio

Companies

Arkansas Best CorporationC.H. RobinsonCeladon Group, Inc.
Con-way Inc.Covenant Transportation GroupHeartland Express, Inc.
J.B. Hunt Transport Services, Inc.Knight Transportation, Inc.LandStar System, Inc.
Marten Transport, Ltd.Old Dominion Freight LineRoadrunner Transportation Systems, Inc.
Saia, Inc.Swift Transportation Co.USA Truck
Vitran CorporationWerner Enterprises, Inc.YRC Worldwide Inc.
Tweaking Estimates as a Strong Holiday Season Sets Stage for Meet-to-Beat Qtr (01/24/2012)
Truckload Industry 2011 Year in Review: A Year to Be Forgotten? (01/11/2012)
Morning Brief - Jan 11 2012 (FTK, Truckload Industry) (01/11/2012)
Weekly Comparative Valuation TL & LTL (01/09/2012)
Weekly Comparative Valuation TL & LTL (01/03/2012)
First Look at the Final HOS Rules From the FMCSA (12/23/2011)
Weekly Comparative Valuation TL & LTL (12/19/2011)
TL & LTL Weekly Comparative Valuation (12/12/2011)
TL & LTL Comparative Valuation (12/05/2011)
Could a Strong Holiday Shipping Season Drive a Catch Up Trade For the Truckers? (12/05/2011)
Weekly Comparative Valuation TL & LTL (11/28/2011)
Weekly Comparative Valuation TL & LTL (11/22/2011)
Weekly Comparative Valuation - TL & LTL (11/14/2011)
Weekly Comparative Valuation TL & LTL (11/07/2011)
Weekly Comparative Valuation TL & LTL (10/31/2011)
Weekly Comparative Valuation TL & LTL (10/24/2011)
Weekly Comparative Valuation TL & LTL (10/17/2011)
Adjusting TL Estimates to Reflect a 0% GDP Growth Environment (10/12/2011)
Weekly Comparative Valuation TL & LTL (10/10/2011)
Is the Market Predicting an LTL Environment That Cannot Realistically Exist? (10/10/2011)
Weekly Comparative Valuation TL & LTL (10/03/2011)
Weekly Comparative Valuation TL & LTL (09/26/2011)
Weekly Comparative Valuation TL & LTL (09/19/2011)
Weekly Comparative Valuation - TL & LTL (09/12/2011)
Dropping Coverage of PTSI and UACL (09/08/2011)
Truckload and LTL Weekly Comparative Valuation (09/06/2011)
Weekly Comparative Valuation TL & LTL (08/29/2011)
Mid QTR Freight Update: Some Slowing But Not to the Degree The Market Suggests (08/23/2011)
Weekly Comparative Valuation TL & LTL (08/22/2011)
TL & LTL Comparative Valuation (08/15/2011)
Weekly Comparative Valuation TL & LTL (08/08/2011)
Weekly Comparative Valuation TL & LTL (08/01/2011)
Weekly Comparative Valuation TL & LTL (07/25/2011)
Weekly Comparative Valuation TL & LTL (07/18/2011)
Strong 2nd Half of 2Q11 Sets Stage for “Meet or Beat” Quarter for the Truckers (07/14/2011)
Weekly Comparative Valuation TL & LTL (07/11/2011)
TL & LTL Weekly Comparative Valuation (07/07/2011)
Weekly Comparative Valuation TL & LTL (06/27/2011)
Weekly Comparative Valuation TL & LTL (06/20/2011)
Weekly Comparative Valuation TL & LTL (06/13/2011)
Weekly Comparative Valuation TL & LTL (06/06/2011)
Weekly Comparative Valuation TL & LTL (05/31/2011)
TL & LTL Weekly Comparative Valuation (05/23/2011)
TL & LTL Weekly Comparative Valuation (05/16/2011)
Weekly Comparative Valuation TL & LTL (05/09/2011)
Comparative Valuation (05/02/2011)
With Headwinds Behind Us, LTL Outlook More Promising (04/06/2011)
Comparative Valuation (04/04/2011)
Lowering TL Estimates as Fuel Rains on the Trucking Parade (03/28/2011)
Comparative Valuation (03/21/2011)
Comparative Valuation (03/14/2011)
Comparative Valuation (03/07/2011)
Comparative Valuation (02/28/2011)
Comparative Valuation (02/22/2011)
Comparative Valuation (02/14/2011)
On the Verge of Change: How CSA Could Impact Shipping Trends (02/10/2011)
Comparative Valuation (02/07/2011)
Truckload FY11 Preview: A Whole Lot Like 2010 Only Better (01/20/2011)
Truckload FY11 Preview: A Whole Lot Like 2010 Only Better (01/20/2011)
Comparative Valuation (01/18/2011)
TL: Reduced Estimates to Reflect Harsh Winter Weather and Higher Fuel Prices (01/13/2011)
Comparative Valuation (01/11/2011)
LTL:More Cautious View as Valuation / Est. Risk Outweigh Improving Fundamentals (01/10/2011)
Weekly Comparative Valuation (01/03/2011)
Weekly Comparative Valuation (12/20/2010)
Weekly Comparative Valuation (12/13/2010)
Transportation - Coverage Update (12/07/2010)
Weekly Comparative Valuation (12/06/2010)
Warming Up to TL Stocks as 2H10 Challenges Put the Squeeze on Marginal Carriers (11/29/2010)
Weekly Comparative Valuation (11/29/2010)
Weekly Comparative Valuation (11/22/2010)
Weekly Comparative Valuation (11/15/2010)
Weekly Comparative Valuation (11/08/2010)
Weekly Comparative Valuation (11/01/2010)
Weekly Comparative Valuation (10/25/2010)
Weekly Comparative Valuation (10/18/2010)
Weekly Comparative Valuation (10/11/2010)
Weekly Comparative Valuation (10/04/2010)
YRCW's Survival Plan Adds Fuel to the LTL Fire (09/30/2010)
Weekly Comparative Valuation (09/27/2010)
Moderating Demand & Net Fuel Headwinds Lead to Near-Term EPS Revisions (09/27/2010)
Weekly Comparative Valuation (09/20/2010)
Getting Real With the LTLs; Lowering 2H10 and FY11 Estimates (09/15/2010)
Weekly Comparative Valuation (09/13/2010)
Weekly Comparative Valuation (09/07/2010)
Weekly Comparative Valuation (08/30/2010)
Weekly Comparative Valuation (08/23/2010)
The State of the LTL Industry: A Realistic Outlook for 2H10 and FY11 (08/19/2010)
Weekly Comparative Valuation (08/16/2010)
Weekly Comparative Valuation (08/09/2010)
Weekly Comparative Valuation (08/02/2010)
Weekly Comparative Valuation (07/26/2010)
Improved Fundamentals + High Employee Utilization = Potential 2Q Upside (07/20/2010)
Weekly Comparative Valuation (07/19/2010)
Results From JBHT and CVTI Paint Rosy Picture for 2Q10 TL Earnings Season (07/16/2010)
Shipper Checks Suggest TL Rates Above Est; Concerns About 2H10 Slowdown (07/13/2010)
Weekly Comparative Valuation (07/12/2010)
Weekly Comparative Valuation (07/06/2010)
Weekly Comparative Valuation (06/14/2010)
Weekly Comparative Valuation (06/07/2010)
Weekly Comparative Valuation (05/24/2010)
Channel Checks Suggest Surprisingly Strong TL Fundamentals (05/19/2010)
Weekly Comparative Valuation (05/17/2010)
Weekly Comparative Valuation (05/11/2010)
Weekly Comparative Valuation (05/03/2010)
Institutional Investor Transportation Field Trip 2010 (04/21/2010)
Channel Checks Suggest TL Pricing Worm Has Turned After Soft Bid Season (04/13/2010)
Weekly Comparative Valuation (04/12/2010)
Weekly Comparative Valuation (04/05/2010)
Weekly Comparative Valuation (03/29/2010)
Examining Earnings Leverage and Valuation Multiples in the LTL Space (03/19/2010)
Examining Earnings Leverage and Peak Earnings Valuations in the Truckload Space (03/16/2010)
Weekly Comparative Valuation (03/15/2010)
Weekly Comparative Valuation (03/08/2010)
Weekly Comparative Valuation (03/01/2010)
TL Trends Showing Surprising Strength; Raising Ratings on KNX, WERN and PTSI (02/26/2010)
Weekly Comparative Valuation (02/22/2010)
Weekly Comparative Valuation (02/16/2010)
Weekly Comparative Valuation (01/26/2010)
Conversations With Shippers Suggest Little Improvement in Truckload Bid Rates (01/25/2010)
Weekly Comparative Valuation (01/19/2010)
Weekly Comparative Valuation (01/12/2010)
The Bullish Case for Truckload Stocks (01/11/2010)
Weekly Comparative Valuation (01/04/2010)
Thoughts on LTL Sector Post YRCW's Successful Debt-for-Equity Exchange (01/04/2010)