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Here's How Much a $1000 Investment in Old Dominion Freight Line Made 10 Years Ago Would Be Worth Today
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For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Old Dominion Freight Line (ODFL - Free Report) ten years ago? It may not have been easy to hold on to ODFL for all that time, but if you did, how much would your investment be worth today?
Old Dominion Freight Line's Business In-Depth
With that in mind, let's take a look at Old Dominion Freight Line's main business drivers.
Old Dominion Freight Line, founded in 1934, is a leading LTL company. The company based in Thomasville, NC, offers LTL services on a regional, inter-regional and national basis. The services are inclusive of ground and air expedited transportation, apart from consumer household pickup and delivery through a single integrated organization.
The company also offers LTL services across North America through strategic alliances. Additionally, it provides value-added services like container drayage, truckload brokerage, supply chain consulting and warehousing. The company operates multiple service and maintenance centers.
While bulk of the centers is owned by the company, the remaining are leased. The service centers are endowed with responsibility pertaining to the pickup and delivery of freight locally. Moreover, the maintenance centers are responsible for performing operations that are related to the routine and preventive maintenance as well as repairs of the company’s equipment.
Old Dominion’s infrastructure allows for smoother freight transportation offering next-day and second-day service through each of its regions across the United States. Over the past several years, the company has opened numerous service centers which have increased capacity across its service network. This in turn places the company for future growth prospects.
The company constantly works towards improving customer service by increasing on-time performance and reducing cargo claims. It primarily focuses on increasing shipments and tonnage growth in order to generate higher revenues.
The company faces primary competition from regional, inter-regional and national LTL carriers. It also faces secondary competition from truckload carriers, small package carriers, airfreight carriers and railroads.
Owing to the betterment in scenario in 2021, total revenues increased 30.9% year over year to $5.26 billion. LTL service revenues were up 30.7% and accounted for bulk of the top line (98.6%). Remainder of the top line was generated from non-LTL revenues.
Notably, LTL tons increased 15.4% year over year with LTL shipments rising 18.5%. Moreover, LTL weight per shipment, excluding fuel surcharges, increased 6% in 2021.
Moreover, the company’s fiscal year coincides with the calendar year.
Bottom Line
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Old Dominion Freight Line, if you bought shares a decade ago, you're likely feeling really good about your investment today.
According to our calculations, a $1000 investment made in December 2012 would be worth $13,574.22, or a 1,257.42% gain, as of December 1, 2022. Investors should keep in mind that this return excludes dividends but includes price appreciation.
Compare this to the S&P 500's rally of 188.11% and gold's return of -0.75% over the same time frame.
Analysts are anticipating more upside for ODFL.
Old Dominion's efforts to add shareholder value are impressive. In the first nine months of 2022, ODFL paid dividends of $101.4 million and repurchased shares worth $1.1 billion. Improvement in the operating ratio (operating expenses as a percentage of revenues), owing to higher revenues, is encouraging. With improved freight market conditions, rise in LTL (Less-Than-Truckload) shipments is driving the top line. However, high capital expenditures might be an overhang. Capiex for 2022 are likely to be $720 million compared with $550.1 million in 2021. Moreover, high operating expenses pose a threat to Old Dominion's bottom line. Total operating expenses rose 18.7% in the first nine months of 2022 due to a rise in costs pertaining to salaries, wages & benefits among other factors..
The stock has jumped 16.21% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 7 higher, for fiscal 2022; the consensus estimate has moved up as well.
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Here's How Much a $1000 Investment in Old Dominion Freight Line Made 10 Years Ago Would Be Worth Today
For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Old Dominion Freight Line (ODFL - Free Report) ten years ago? It may not have been easy to hold on to ODFL for all that time, but if you did, how much would your investment be worth today?
Old Dominion Freight Line's Business In-Depth
With that in mind, let's take a look at Old Dominion Freight Line's main business drivers.
Old Dominion Freight Line, founded in 1934, is a leading LTL company. The company based in Thomasville, NC, offers LTL services on a regional, inter-regional and national basis. The services are inclusive of ground and air expedited transportation, apart from consumer household pickup and delivery through a single integrated organization.
The company also offers LTL services across North America through strategic alliances. Additionally, it provides value-added services like container drayage, truckload brokerage, supply chain consulting and warehousing. The company operates multiple service and maintenance centers.
While bulk of the centers is owned by the company, the remaining are leased. The service centers are endowed with responsibility pertaining to the pickup and delivery of freight locally. Moreover, the maintenance centers are responsible for performing operations that are related to the routine and preventive maintenance as well as repairs of the company’s equipment.
Old Dominion’s infrastructure allows for smoother freight transportation offering next-day and second-day service through each of its regions across the United States. Over the past several years, the company has opened numerous service centers which have increased capacity across its service network. This in turn places the company for future growth prospects.
The company constantly works towards improving customer service by increasing on-time performance and reducing cargo claims. It primarily focuses on increasing shipments and tonnage growth in order to generate higher revenues.
The company faces primary competition from regional, inter-regional and national LTL carriers. It also faces secondary competition from truckload carriers, small package carriers, airfreight carriers and railroads.
Owing to the betterment in scenario in 2021, total revenues increased 30.9% year over year to $5.26 billion. LTL service revenues were up 30.7% and accounted for bulk of the top line (98.6%). Remainder of the top line was generated from non-LTL revenues.
Notably, LTL tons increased 15.4% year over year with LTL shipments rising 18.5%. Moreover, LTL weight per shipment, excluding fuel surcharges, increased 6% in 2021.
Moreover, the company’s fiscal year coincides with the calendar year.
Bottom Line
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Old Dominion Freight Line, if you bought shares a decade ago, you're likely feeling really good about your investment today.
According to our calculations, a $1000 investment made in December 2012 would be worth $13,574.22, or a 1,257.42% gain, as of December 1, 2022. Investors should keep in mind that this return excludes dividends but includes price appreciation.
Compare this to the S&P 500's rally of 188.11% and gold's return of -0.75% over the same time frame.
Analysts are anticipating more upside for ODFL.
Old Dominion's efforts to add shareholder value are impressive. In the first nine months of 2022, ODFL paid dividends of $101.4 million and repurchased shares worth $1.1 billion. Improvement in the operating ratio (operating expenses as a percentage of revenues), owing to higher revenues, is encouraging. With improved freight market conditions, rise in LTL (Less-Than-Truckload) shipments is driving the top line. However, high capital expenditures might be an overhang. Capiex for 2022 are likely to be $720 million compared with $550.1 million in 2021. Moreover, high operating expenses pose a threat to Old Dominion's bottom line. Total operating expenses rose 18.7% in the first nine months of 2022 due to a rise in costs pertaining to salaries, wages & benefits among other factors..
The stock has jumped 16.21% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 7 higher, for fiscal 2022; the consensus estimate has moved up as well.