Q3 Earnings Highlights: RXO (NYSE:RXO) Vs The Rest Of The Ground Transportation Stocks

Looking back on ground transportation stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including RXO (NYSE:RXO) and its peers.

The growth of e-commerce and global trade continues to drive demand for shipping services, especially last-mile delivery, presenting opportunities for ground transportation companies. The industry continues to invest in data, analytics, and autonomous fleets to optimize efficiency and find the most cost-effective routes. Despite the essential services this industry provides, ground transportation companies are still at the whim of economic cycles. Consumer spending, for example, can greatly impact the demand for these companies’ offerings while fuel costs can influence profit margins.

The 16 ground transportation stocks we track reported a softer Q3. As a group, revenues missed analysts’ consensus estimates by 1.9%.

Thankfully, share prices of the companies have been resilient as they are up 8.7% on average since the latest earnings results.

RXO (NYSE:RXO)

With access to millions of trucks, RXO (NYSE:RXO) offers full-truckload, less-than-truckload, and last-mile deliveries.

RXO reported revenues of $1.04 billion, up 6.6% year on year. This print fell short of analysts’ expectations by 0.6%. Overall, it was a softer quarter for the company with a significant miss of analysts’ adjusted operating income estimates and EBITDA guidance for next quarter missing analysts’ expectations.

Drew Wilkerson, chief executive officer of RXO, said, “In the third quarter, our focus on execution enabled us to achieve a solid 13.7% gross margin in our Brokerage business, despite the prolonged soft freight market. Momentum continued within our complementary services. In Managed Transportation, we secured more than $300 million in new business and continue to have a strong sales pipeline of more than $1.3 billion in freight under management. In Last Mile, we grew stops by 11% year-over-year, an acceleration from our second-quarter growth rate.”

Unsurprisingly, the stock is down 14.5% since reporting and currently trades at $27.29.

Read our full report on RXO here, it’s free.

Best Q3: XPO (NYSE:XPO)

Owning a mobile game simulating freight operations for the Tour de France, XPO (NYSE:XPO) is a transportation company specializing in expedited shipping services.

XPO reported revenues of $2.05 billion, up 3.7% year on year, outperforming analysts’ expectations by 1.8%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates.

XPO pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 30.4% since reporting. It currently trades at $156.79.

Is now the time to buy XPO? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Werner (NASDAQ:WERN)

Conducting business in over a 100 countries, Werner (NASDAQ:WERN) offers full-truckload, less-than-truckload, and intermodal delivery services.

Werner reported revenues of $745.7 million, down 8.8% year on year, falling short of analysts’ expectations by 2.6%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.

Interestingly, the stock is up 1.5% since the results and currently trades at $38.83.

Read our full analysis of Werner’s results here.

U-Haul (NYSE:UHAL)

Founded by a husband and wife duo, U-Haul (NYSE:UHAL) is a provider of rental trucks and storage facilities.

U-Haul reported revenues of $1.66 billion, flat year on year. This print came in 1.7% below analysts' expectations. Overall, it was a disappointing quarter as it also produced a significant miss of analysts’ EPS estimates.

The stock is down 4.1% since reporting and currently trades at $73.26.

Read our full, actionable report on U-Haul here, it’s free.

Universal Logistics (NASDAQ:ULH)

Founded in 1932, Universal Logistics (NASDAQ:ULH) is a provider of customized transportation and logistics solutions operating throughout the United States and in Mexico, Canada, and Colombia.

Universal Logistics reported revenues of $426.8 million, up 1.3% year on year. This print came in 8% below analysts' expectations. It was a softer quarter as it also produced a significant miss of analysts’ EPS estimates.

Universal Logistics had the weakest performance against analyst estimates among its peers. The stock is up 11.6% since reporting and currently trades at $48.47.

Read our full, actionable report on Universal Logistics here, it’s free.

Market Update

Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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