Moving past the last years’ abnormal fleet supply growth, positive demand fundamentals will be better reflected in freight rates and vessel values, supporting a market recovery to historical levels.
Investors should consider Star Bulk Carriers (NASDAQ: SBLK) as a direct play in the shipping industry. The stock has returned to profitability in 2013 and is projected to increase earnings by 85 percent in 2014. The stock is trading at reasonable valuations and has 35 percent upside potential.
Morgan Stanley is taking a bullish stance on the dry bulk shipping industry. Their analysts predict that rates for shippers will rally over the next two years, as demand for iron ore and grains overtake supply. Shipping companies will benefit from the rally.
Top Insurance Companies To Own In Right Now: Heartland Express Inc (HTLD)
Heartland Express, Inc. (Heartland), incorporated on August 8, 1986, is a short-to-medium haul truckload carrier. The Company provides regional dry van truckload services through its regional terminals plus its corporate headquarters. The Company transports freight for shippers and generally earns revenue based on the number of miles per load delivered. The Company�� primary traffic lanes are between customer locations east of the Rocky Mountains. The Company is a holding company of Heartland Express Inc. of Iowa, Heartland Express Services, Inc., Heartland Express Maintenance Services, Inc. and A & M Express, Inc. Heartland operates nine specialized regional distribution operations in Atlanta, Georgia; Carlisle, Pennsylvania; Chester, Virginia; Columbus, Ohio; Jacksonville, Florida; Kingsport, Tennessee; Olive Branch, Mississippi; Phoenix, Arizona, and Seagoville, Texas. The Company operates maintenance facilities at all regional distribution operating centers along with shop only locations in Fort Smith, Arkansas and O��allon, Missouri. In November 2013, Heartland Express Inc acquired 100% of the stock of Gordon Trucking, Inc.
The Company�� operations department is responsible for maintaining the continuity between the customer�� needs and Heartland�� ability to meet those needs by communicating customer�� expectations to the fleet management group. They are charged with development of customer relationships, ensuring service standards, coordinating proper freight-to-capacity balancing, trailer asset management, and daily tactical decisions pertaining to matching the customer demand with the appropriate capacity within geographical service areas. They assign orders to drivers based on well-defined criteria, such as driver safety and United States Department of Transportation (the DOT) compliance, customer needs and service requirements, on-time service, equipment utilization, driver time at home, operational efficiency, and equipment maintenance needs. Fleet management is r! esponsible for driver management and development. Their responsibilities include meeting the needs of the drivers within the standards that have been set by the organization and communicating the requirements of the customers to the drivers on each order to ensure successful execution. Serving the short-to-medium haul market (500 miles average length of haul in 2012) permits the Company to use primarily single, rather than team drivers and dispatch loads directly from origin to destination without an intermediate equipment change other than for driver scheduling purposes.
Advisors' Opinion:- [By CRWE]
Heartland Express, Inc. (Nasdaq:HTLD) reported that on Wednesday, May 30, 2012, members of its management team will participate in the 2012 KeyBanc Capital Markets Industrial, Automotive and Transportation conference.
- [By Lauren Pollock]
Heartland Express Inc.(HTLD), a trucking firm steered by the Gerdin family, agreed to acquire another family controlled peer, Gordon Trucking Inc., in a transaction valued at about $300 million. Shares climbed 12% to $16.05 in light premarket trading.
- [By Ben Levisohn]
Shares of Heartland Express (HTLD) rose today despite being cut by Stifel Nicolaus for valuation reasons.
Bloomberg NewsShares of Heartland Express have gained 50% this year, trumping the 38% rise in Con-Way (CNW) and the 29% advance in J.B. Hunt Transport Services (JBHT) but lagging Old Dominion Freight Lines (ODFL) and Swift Transportation (SWFT).
That big gain was enough for Stifel’s John Larkin say no mas and cut his rating on Heartland Express. They explain why:
Downgrading from Buy to Hold as the company’s shares appear fully and fairly valued. In fact, shares have recently traded through our 12-month fair value estimate of $19 (or 16.0x our 2015 EPS estimate of $1.15 plus ~$0.68 per share NPV of future cash tax benefits).
Rating change is primarily valuation based as well as from our view that most transportation equities are trading ahead of the still mediocre underlying freight market fundamentals.
BB&T’s Thomas Albrecht and team, who upgraded Heartland Express to Buy from Hold yesterday, explain why they think the stock will do just fine regardless of the economy:
Heartland is an intriguing play upon both a slow-growth economy and a rapidly growing one (along with tight capacity). Many carriers are only able to thrive in the latter environment. With HTLD we believe that even in a sluggish economy it has a self-generating EPS story through the integration and growth of Gordon. Q3’13, a very difficult quarter for TL carriers, saw HTLD post a 79.3% OR versus 83.3%.
The timing of the Gordon deal seems ideal, similar to the Great Coastal acquisition in mid-2002. Back then the TL market was stabilizing, but had yet to really take off, which occurred in the back half of 2003. Those 4-5 quarters allowed HTLD to assess customers, integrate operations, consolidate facilities and get ready for the next cycle. By the time that occurred HTLD was ready to take advantage of the capacity
- [By Jake L'Ecuyer]
Equities Trading UP
Heartland Express (NASDAQ: HTLD) shot up 19.72 percent to $17.14 after the company reported that it has acquired Gordon Trucking for $300 million.
Top 5 Freight Companies To Watch For 2014: Aurizon Holdings Ltd (QRNNF)
Aurizon Holdings Limited, formerly QR National Limited, is a rail freight operator. It owns and operates a coal network made up of 2,670 kilometers of heavy haul rail infrastructure. It provides specialist services in rail design, engineering, construction, management and maintenance, and offers supply chain solutions to a range of customers in Australia. Its business comprises three product lines. Coal business includes transport of coal from mines in Queensland and New South Wales to end customers and ports. Freight business includes transport of bulk mineral commodities, including iron ore, agricultural products, mining and industrial inputs and general freight throughout Queensland and Western Australia. Network Services business provides access to, and operation and management of the Central Queensland Coal Network. In January 2014 the Company announced that National Australia Bank Limited and its associated entities has ceased to be the substantial holder of the Company. Advisors' Opinion:- [By MARKETWATCH]
LOS ANGELES (MarketWatch) -- Australia stocks enjoyed early Monday gains after an advance for commodities and U.S. stocks since the last session, with a relatively good reception for earnings. The S&P/ASX 200 (AU:XJO) improved by 0.4% to 5,376.30, with miners tracking gains in gold and copper. Rio Tinto Ltd. (AU:RIO) (RIO) added 1.3%, and Fortescue Metals Group Ltd. (AU:FMG) (FSUMF) traded 1.1% higher, while gold miners Newcrest Mining Ltd. (AU:NCM) (NCMGF) and Kingsgate Consolidated Ltd. (AU:KCN) (KSKGF) rallied 2.2% and 4.7%, respectively. Banks rose after Wall Street shares climbed on Friday, with National Australia Bank Ltd. (AU:NAB) (NAUBF) up 1% and Australia & New Zealand Banking Group (AU:ANZ) (ANEWF) adding 0.9%, though Commonwealth Bank of Australia (AU:CBA) (CBAUF) dropped 2.4% as it traded without rights to its latest dividend. Coal transport firm Aurizon Holdings Ltd. (AU:AZJ) (QRNNF) tacked on 2.1% as its fiscal first-half underlying profit increased 18%, though net profit f
Top 5 Freight Companies To Watch For 2014: Echo Global Logistics Inc (ECHO)
Echo Global Logistics, Inc. (Echo) is a provider of technology enabled transportation and supply chain management services. Its Web-based technology platform compiles and analyzes data from its network of over 24,000 transportation providers to serve its clients' shipping and freight management needs. Its technology platform, composed of Web-based software applications and a database, enables it to identify excess transportation capacity, obtain competitive rates, and execute thousands of shipments every day. It focuses on arranging transportation across truckload (TL) and less than truck load (LTL), and it also offers small parcel, inter-modal (which involves moving a shipment by rail and truck), domestic air, expedited and international transportation services. Its logistics services include rate negotiation, shipment execution and tracking, carrier management, routing compliance, freight bill audit and payment and performance management reporting, including executive dashboard tools. Effective January 1, 2011, the Company acquired Nationwide Traffic Services, LLC. (Nationwide) Effective July 1, 2011, the Company acquired Advantage Transport, Inc. (Advantage). Effective December 1, 2011, the Company acquired the stock of Trailer Transport Systems (TTS). In June 2012, the Company acquired Plum Logistics, LLC. In July 2012, it acquired all of the assets of Shipper Direct Logistics, Inc. In October 2012, the Company acquired Sharp Freight Systems, Inc.
The Company�� clients fall into two categories, enterprise and transactional. Its enterprise clients outsource their transportation management function to Echo. It enters into multi-year contracts with its enterprise clients. As part of its value proposition, it also provides core logistics services to these clients, including the management of both freight expenditures and logistical issues surrounding freight to be transported. It provides transportation and logistics services to its transactional clients on a shipment-by-shipment basis.! It is a non-asset-based provider of technology enabled transportation and logistics services. Through its carrier network, it provides transportation services using a range of modes of transportation.
Transportation Services
The Company provides Truckload (TL) services across all TL segments, including dry vans, temperature-controlled units and flatbeds. Using its LaneIQ technology, it provide advanced dispatch, communication and data collection tools and capacity information to its clients on a real-time basis. The Company provides less than truckload (LTL) services involving the shipment of single or multiple pallets of freight. Using its RateIQ 2.0 technology, it obtains real-time pricing and transit time information for every LTL shipment from its database of LTL carriers. It provides small parcel services for packages of all sizes. Using its EchoPak technology, it delivers cost saving opportunities to its clients. Inter-modal transportation is the shipping of freight by multiple modes, using a container that is transferred between ships, railcars or trucks. It offers inter-modal transportation services for its clients, which utilizes both trucks and rail. The Company provides domestic air and expedited shipment services for its clients when traditional LTL services do not meet delivery requirements. It uses ETM track and trace tools for up to date information to its clients through EchoTrak. The Company provides air and ocean transportation services for its clients, offering a comprehensive international delivery option to its clients.
Logistics Services
In addition to arranging for transportation, the Company provides logistics services, either on-site (in the case of some enterprise clients) or off-site, to manage the flow of those goods from origin to destination. Its core logistics services include rate negotiation; procurement of transportation, both contractually and in the spot market; shipment execution and tracking; carrier management, ! reporting! and compliance; executive dashboard presentations and detailed shipment reports; freight bill audit and payment; claims processing and service refund management; design and management of inbound client freight programs; individually configured Web portals and self-service data warehouses; enterprise resource planning (ERP) integration with transactional shipment data, and integration of shipping applications into client e-commerce sites. Customers communicate their freight needs, typically on a shipment-by-shipment basis, to the individual or team responsible for their account. Customers communicate with it by means of telephone, fax, Internet, e-mail, or Electronic Data Interchange (EDI).
Technology Platform
The Company�� ETM technology platform allows it to analyze its clients' transportation requirements and provide customized shipping recommendations. It collects and store pricing and market capacity data in its ETM database from each interaction with carriers, and its database expands as a result of these interactions. It has also developed data acquisition tools, which retrieve information from both private and public transportation databases, including subscription-based sources and public transportation rate boards, and incorporate that information into the ETM database. Its clients communicate their transportation needs to it electronically through its EchoTrak web portal, other computer protocols, or by phone. ETM generates pricing and carrier information for its clients by accessing pre-negotiated rates with preferred carriers or using present or historical pricing and capacity information contained in its database. If a client enters its own shipment, ETM automatically alerts the appropriate account executive. After the carrier is selected, either by it or the client, its account executives use its ETM technology platform to manage all aspects of the shipping process.
The Company�� FastLane is an Internet-based Web portal, which allows its carriers! to view ! shipments available for tender, update equipment availability and preferred lanes, check on the status of all unpaid invoices, unbilled shipments, shipments in transit and other information used to resolve any billing discrepancies. There is also a mobile FastLane application, which allows carriers to view similar information remotely. eConnect is a set of tools, which allows the Company�� clients and carriers to interact directly with ETM electronically through any of several computer protocols, including EDI, extensible markup language (XML) and file transfer protocol (FTP). The eConnect tools serve as an electronic bridge between the other elements of its ETM technology platform and its clients' enterprise resource planning (ERP), billing, accounts receivable, accounts payable, order management, back office and e-commerce systems. Through eConnect, its clients are able to request shipping services and receive financial and tracking data using their existing systems.
EchoTrak is an Internet-based Web portal, which connects and integrates its clients with ETM. By entering a username and password, its clients are able to enter orders, display historical and active shipments in the ETM system using configurable data entry screens sorted by carrier, price, delivery date, destination and other relevant specifications. EchoTrak also generates automatic alerts to ensure that shipments are moving in accordance with the client specifications and timeline. There is also a mobile EchoTrak application, which allows customers to perform similar functions remotely. RateIQ2.0 is a pricing engine, which manages LTL tariffs and generates rate quotes and transit times for LTL shipments. RateIQ2.0 also provides integrated tools to manage dispatch, communications, data collection and management functions relating to LTL shipments. LaneIQ is a pricing engine, which generates rate quotes for TL shipments. LaneIQ also provides integrated tools to manage dispatch, communications, headhaul and backhaul data col! lection a! nd management functions relating to TL shipments. EchoPak is a small parcel pricing and audit engine. For each small parcel shipped, EchoPak audits carrier compliance with on-time delivery requirements and pricing tariffs. In addition, EchoPak tracks information for each parcel and is able to aggregate and analyze that data for clients. For instance, clients are able to view shipments by date, business unit, product line and location, and clients can access information regarding service levels and pricing.
The Company�� Shipment Tracking stores shipment information en-route and after final delivery. The shipment data is acquired through its carrier EDI integration, allowing its clients to track the location and status of all shipments on one screen, regardless of mode or carrier. Final delivery information is permanently archived, allowing it to provide its clients with carrier performance reporting by comparing actual delivery times with the published transit time standards.
Document Imaging allows the Company to store digital images of all shipping documents, including bills of lading and delivery receipts. CAS (Cost Allocation System) automatically audits carrier invoices against its rating engine and accounts payable accrual system. If the amounts match, the invoice is automatically released for payment. If the amounts do not match, the invoice is sent to various administrative personnel for manual processing and resolution. CAS also integrates to its general ledger, accounts receivable and accounts payable systems. Accounting includes its general ledger, accounts receivable and accounts payable functions. Accounting is integrated with CAS and EchoIQ. EchoIQ stores internally and externally generated data to support its reporting and analytic functions and integrate all of its core applications with ETM. ETM supports its logistics services, which it provides to its clients as part of its value proposition. Its ETM technology platform is able to track individual shipments ! and provi! de customized data and reports throughout the lifecycle of the shipment, allowing it to manage the entire shipping process for its clients. It also market Flex TMS.
The Company competes with C.H. Robinson Worldwide, Total Quality Logistics, UPS, FedEx, Schneider, Conway, JB Hunt and ABF.
Advisors' Opinion:- [By Seth Jayson]
Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on Echo Global Logistics (Nasdaq: ECHO ) , whose recent revenue and earnings are plotted below.
Top 5 Freight Companies To Watch For 2014: Universal Truckload Services Inc (UACL)
Universal Truckload Services, Inc., incorporated on December 11, 2001, is engaged in providing transportation services to shippers throughout the United States and in the Canadian provinces of Ontario and Quebec. The Company�� over-the-road trucking services include both flatbed and dry van operations and it provides rail-truck and steamship-truck intermodal support services. It also offers truck brokerage services, as well as full service international freight forwarding and customs house brokerage services. The Company provides truckload transportation and related services for a range of general commodities over irregular routes using dry and specialty vans and un-sided trailers, including flatbed, drop deck, and specialty. In December 2013, the Company announced that it has completed acquisition of Westport Axle Corporation.
The Company primarily operates through a contractor network of agents and owner-operators who provide the Company with approximately 3,100 tractors and approximately 3,000 trailers. At December 31, 2011, the Company had approximately 565 agents. The Company conducts its operations through its wholly owned operating subsidiaries under the brand names, such as Universal Am-Can, Ltd., Mason & Dixon Lines, Inc., Louisiana Transportation Inc., Mason Dixon Intermodal, Inc., Economy Transport, Inc., Great American Lines, Inc., Universal Logistics Solutions, Inc., Universal Logistics Solutions International, Inc. and Cavalry Transportation, LLC.
The Company provides services in three categories, such as truckload services, brokerage services and intermodal support services. The Company transports a range of general commodities, including machinery, building materials, paper, food, consumer goods, automotive parts, furniture, steel and other metals. During the year ended December 31, 2011, its truckload operations represented 60.5%, of its operating revenues.
The Company provides primarily broker freight to third-party transportation providers th! rough its agent network at times when the Company generates more freight business than it can service with its available owner-operators. The Company offers full service international freight forwarding and customs house brokerage services, as well as third-party logistic services. During 2011, its brokerage services represented 24.8%, of its operating revenues. Its intermodal support services are primarily short-to-medium distance delivery of rail and steamship containers between the railhead or port and the customer and drayage services. During 2011, its intermodal support services represented 14.7% of its operating revenues.
The Company�� agents provide the primary interaction with its shippers. They generate freight shipments and also provide terminal and dispatch services for the owner-operators and are an essential source for recruitment of new owner-operators. The agents use a company-provided software program to list available freight procured by the agent, dispatch owner-operators to haul the freight and provide all administrative information necessary for it to establish the credit arrangements for each shipper. The owner-operators are individuals who own, operate and maintain one or more tractors that they either provide drivers, or drive themselves. The Company�� owner-operators provide it with approximately 3,100 tractors. Owner-operators also may own trailers that they provide the Company in addition to their tractor and driving services. As of December 31, 2011, its owner-operators provided approximately 3,000 trailers, which represent over 50% of the trailers the Company use in its business.
Advisors' Opinion:- [By Sean Williams]
What: Shares of Universal Truckload Services (NASDAQ: UACL ) , a North American provider of trucking and logistics solutions, jumped as much as 12% after receiving an upgrade from BB&T�Capital Markets.
- [By Seth Jayson]
Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on Universal Truckload Services (Nasdaq: UACL ) , whose recent revenue and earnings are plotted below.
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