Spotting Winners: Old Dominion Freight Line (NASDAQ:ODFL) And Ground Transportation Stocks In Q2

As the Q2 earnings season wraps, let’s dig into this quarter’s best and worst performers in the ground transportation industry, including Old Dominion Freight Line (NASDAQ:ODFL) 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 satisfactory Q2. As a group, revenues were in line with analysts’ consensus estimates.

While some ground transportation stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.9% since the latest earnings results.

Old Dominion Freight Line (NASDAQ:ODFL)

With its name deriving from the Commonwealth of Virginia’s nickname, Old Dominion (NASDAQ:ODFL) delivers less-than-truckload (LTL) and full-container load freight.

Old Dominion Freight Line reported revenues of $1.41 billion, down 6.1% year on year. This print fell short of analysts’ expectations by 0.7%. Overall, it was a slower quarter for the company with a slight miss of analysts’ sales volume estimates and a miss of analysts’ EPS estimates.

Marty Freeman, President and Chief Executive Officer of Old Dominion, commented, “Old Dominion’s financial results in the second quarter reflect the ongoing softness in the domestic economy. While the challenging macroeconomic backdrop created demand headwinds for our business during the quarter, our market share remained relatively consistent and our team continued to execute on our long-term strategic plan. The cornerstone of our plan remains our commitment to creating an unmatched value proposition for our customers by providing them with superior service at a fair price. As a result, we were pleased to once again achieve an on-time service performance of 99% and a cargo claims ratio of 0.1%."

Unsurprisingly, the stock is down 8.2% since reporting and currently trades at $148.74.

Read our full report on Old Dominion Freight Line here, it’s free.

Best Q2: 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 $753.1 million, down 1% year on year, outperforming analysts’ expectations by 3%. The business had a stunning quarter with a beat of analysts’ EPS and adjusted operating income estimates.

The market seems content with the results as the stock is up 3.6% since reporting. It currently trades at $28.82.

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

Weakest Q2: Heartland Express (NASDAQ:HTLD)

Founded by the son of a trucker, Heartland Express (NASDAQ:HTLD) offers full-truckload deliveries across the United States and Mexico.

Heartland Express reported revenues of $210.4 million, down 23.4% year on year, falling short of analysts’ expectations by 10.4%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.

Heartland Express delivered the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is flat since the results and currently trades at $8.58.

Read our full analysis of Heartland Express’s results here.

Landstar (NASDAQ:LSTR)

Covering billions of miles throughout North America, Landstar (NASDAQ:LSTR) is a transportation company specializing in freight and last-mile delivery services.

Landstar reported revenues of $1.22 billion, down 1.1% year on year. This print topped analysts’ expectations by 0.5%. Overall, it was a strong quarter as it also logged a solid beat of analysts’ adjusted operating income estimates.

The stock is down 2.6% since reporting and currently trades at $134.36.

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

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 $1.42 billion, up 52.6% year on year. This number lagged analysts' expectations by 1%. More broadly, it was actually an exceptional quarter as it recorded a solid beat of analysts’ sales volume estimates and a beat of analysts’ EPS estimates.

RXO delivered the fastest revenue growth among its peers. The stock is up 6% since reporting and currently trades at $16.36.

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

Market Update

In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

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

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