Back to top
Read MoreHide Full Article

Almost two months to the day I wrote about Radiant Logistics (RLGT - Free Report) as the Bull of the Day, since then there was a solid earnings beat and a recent acquisition.  Let’s take a look at this stock’s two month performance as it is the Bull of the Day once again.

First Time Around

Back on April 10, RLGT was the Bull of the Day (https://www.zacks.com/commentary/109517/bull-of-the-day-radiant-logistics-rlgt) and the stock closed at $5.68 on that day.  On June 2, the close was $6.24 – a 9.8% move.  The thesis remains the same, a strong stock in a strong sector that has a solid tailwind behind it.

Follow Brian Bolan on Twitter: @BBolan1

Description

Radiant Logistics, Inc. operates as a third-party logistics company, providing multi-modal transportation and logistics services.

Earnings

On May 10, the company reported earnings of $0.07 when the Zacks Consensus Estimate was calling for just $0.01.  That 6 cent beat translates to a 600% positive earnings surprise.  The company also beat on top too, but shares traded down following the report.

Estimates

In the previous Bull of the Day, I highlighted how earnings estimates moved from a loss of a penny to $0.23 for 2017.  That number has moved higher to $0.27, and further positive earnings surprises will only send the number higher still.

The 2018 Zacks Consensus Estimate is now at $0.24 while two months ago the number was at $0.20.

Estimates continue to move in the right direction.

Acquisition

On June 1, the company announced that it had acquired the assets of its strategic operating partner Dedicated Logistics Technologies. The privately held company that has historically operated under the Company’s Service By Air brand in Newark and Los Angeles.  Terms were not disclosed.

Strong Trends

Recently, I have seen the entire transportation sector heating up. Trucking stocks have done very well, but this was followed by a huge move in the shippers and good earnings from the rail stocks.  One of the reasons that I believe the strength will continue for the truckers as well as the logistics stocks is the demand for Class 8 trucks.  The chart below shows how demand has strengthened over the last several months.

Follow Brian Bolan on Twitter: @BBolan1

Valuation

RLGT has a mixed valuation.  The stock trades at 23x forward earnings, and that is sharply higher than the 16x industry average.  The price to book multiple, however, is much lower than the industry average with a 2.5x multiple compared to 28x.  Finally the price to sales multiple of 0.4x is only about one-third of the 1.3x industry average.

Revenue

I like to look at revenue growth, and for RLGT here is the table that I look at. I see the previous 8 quarters revenue and the next four quarters consensus estimate for the topline.  I am seeing some conservative estimates, so there is a good chance we see these numbers move higher or get beaten soundly when the company reports earnings again.

Looking for Stocks with Skyrocketing Upside? 

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.   

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.      

 See the pot trades we're targeting>>




In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Radiant Logistics, Inc. (RLGT) - free report >>


More from Zacks Bull of the Day

You May Like