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3 Transportation-Services Stocks to Buy Amid Freight Improvement
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The gradual improvement in the overall freight scenario is a huge positive for the Zacks Transportation-Services industry. After a prolonged freight downturn, industry participants are relieved owing to factors like capacity tightening and rising rates. After a prolonged freight downturn, industry participants are relieved owing to factors like capacity tightening and rising rates. The industry is also benefiting from the uptick in AI-related investments, which have increased efficiency. Efforts to reward shareholders are also commendable. However, concerns about tariffs, high inflation and geopolitical woes are major headwinds.
Despite the aforementioned headwinds, the industry has demonstrated resilience, particularly among companies focused on growth strategies and operational efficiency. Given this backdrop of an improving freight scenario, investors would do well to bet on stocks like Expeditors International of Washington (EXPD - Free Report) , Matson (MATX - Free Report) and Schneider National (SNDR - Free Report) at present.
About the Industry
The companies belonging to the Zacks Transportation-Services industry offer transportation, logistics, leasing and maintenance services. Some industry players focus on the business of global logistics management, including international freight forwarding. Third-party logistics entities provide innovative supply-chain solutions. They also focus on services like product sourcing, warehousing and freight shipping. These companies have expertise in trucking, air and ocean transportation. Some players in this industry deliver domestic and international express delivery services. The well-being of the companies in this industrial cohort is directly proportional to the health of the economy. An uptick in manufactured and retail goods, favorable pricing and improvement in global economic conditions bode well for industry participants.
3 Trends Shaping the Future of the Transportation-Services Industry
Freight Scene on the Mend: A Big Positive: After a prolonged downturn, freight demand appears to be brightening. Highlighting the brightening freight demand scenario, the Cass Freight Shipments Index improved 5.6% month on month in August 2026. This measure has improved month on month in five of the past seven months, which confirms the improving scenario. Moreover, the shipments component of the Cass Freight Index rose 2.1% year over year in August, marking the first year-over-year gain since January 2023, ending a 42-month downturn, the longest on record.
The shrinking of capacity, as small carriers exit the market due to lackluster profitability, is resulting in a tightening of the supply-demand gap, thereby improving pricing power.
Uptick in AI Investments Support Efficiencies: Increased AI adoption and automation are significantly boosting the efficiency, safety, and profitability of transport service providers. By leveraging AI-driven predictive analytics, companies can forecast maintenance needs before vehicle breakdowns occur, drastically reducing costly fleet downtime and extending vehicle lifespans. Automated routing algorithms dynamically adjust delivery paths in real time based on traffic, weather, and fuel efficiency, allowing logistics providers to speed up delivery times while cutting fuel expenses. Additionally, AI-powered scheduling and demand forecasting help operators optimize resource allocation, ensuring that vehicles are deployed precisely when and where passenger or cargo demand is highest. Ultimately, these innovations mitigate human error, improve driver safety and enable transport providers to scale their operations smoothly in an increasingly competitive market.
Emphasis on Shareholder Returns: As economic activity rebounds from pandemic-era lows, companies are increasingly using their growing cash reserves to reward shareholders through dividends and share buybacks. This reflects both financial resilience and confidence in prospects. Within the Transportation – Services industry, Matson has raised its quarterly dividend by 5.6% this year.
Zacks Industry Rank Indicates Sunny Prospects
The Zacks Transportation - Services industry is a 20-stock group within the broader Zacks Transportation sector. The industry currently carries a Zacks Industry Rank #96, which places it in the top 39% of 247 Zacks industries.
The group’s Zacks Industry Rank, the average of the Zacks Rank of all member stocks, indicates bright near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are gradually gaining confidence in this group’s earnings growth potential. The industry's earnings estimate for 2026 has increased 7.1% since March-end.
Before we present a few stocks from the industry that you may want to buy, let’s take a look at the industry’s recent stock market performance and the valuation picture.
Industry Lags the S&P 500 and the Sector
The Zacks Transportation-Services industry has underperformed the Zacks S&P 500 composite and the broader Transportation sector in a year
The industry has remained flat over this period compared with the S&P 500's appreciation of 16.2% and the broader sector’s uptick of 16.5%
One-Year Price Performance
Industry's Current Valuation
Based on the forward 12-month price-to-sales, a commonly used multiple for valuing transportation services stocks, the industry is currently trading at 1.62X compared with the S&P 500's 4.71. The value is higher than the sector's trailing 12-month P/S of 1.5X.
Over the past five years, the industry has traded as high as 2.52X, as low as 1.48X and at the median of 1.84X.
Price-to-Sales Ratio (F12M)
3 Transport-Services Stocks to Buy Now
Expeditors, a leading third-party logistics provider, is based in Seattle, WA. The company currently sports a Zacks Rank# 1 (Strong Buy). EXPD’s earnings beat the Zacks Consensus Estimate in each of the past four quarters, with an average surprise of 17.2%.
While weak volumes (concerning air-freight tonnage and ocean containers) stemming from soft demand and declining rates are hurting EXPD’s performance, efforts to cut costs in the face of demand weakness are driving its bottom line. The company’s shareholder-friendly moves also bode well.
Headquartered in Honolulu, HI, Matson provides ocean transportation and logistics services. We are impressed by the cost-management actions taken by the company to drive its bottom line. Matson's efforts to reward its shareholders are also commendable.
MATX currently flaunts a Zacks Rank #1. The Zacks Consensus Estimate for current-year earnings has been revised 16.1% upward over the past 60 days.
Price and Consensus: MATX
Schneider National aims to boost its earnings by leveraging productivity and asset efficiency actions while improving the top line without incremental growth investments. With the successful attainment of the cost savings target in 2025, SNDR aims to achieve another $40 million in targeted cost savings in 2026.
The company raised its 2026 adjusted earnings per share in the range of 90 cents to $1.10 from the prior view of 70 cents to $1.00. Schneider’s solid balance sheet increases financial flexibility. The Zacks Consensus Estimate for current-year earnings has been revised 14.3% upward over the past 60 days. SNDR currently carries a Zacks Rank #2 (Buy).
View the Zacks #1 Rank List
Image: Shutterstock
3 Transportation-Services Stocks to Buy Amid Freight Improvement
The gradual improvement in the overall freight scenario is a huge positive for the Zacks Transportation-Services industry. After a prolonged freight downturn, industry participants are relieved owing to factors like capacity tightening and rising rates. After a prolonged freight downturn, industry participants are relieved owing to factors like capacity tightening and rising rates. The industry is also benefiting from the uptick in AI-related investments, which have increased efficiency. Efforts to reward shareholders are also commendable. However, concerns about tariffs, high inflation and geopolitical woes are major headwinds.
Despite the aforementioned headwinds, the industry has demonstrated resilience, particularly among companies focused on growth strategies and operational efficiency. Given this backdrop of an improving freight scenario, investors would do well to bet on stocks like Expeditors International of Washington (EXPD - Free Report) , Matson (MATX - Free Report) and Schneider National (SNDR - Free Report) at present.
About the Industry
The companies belonging to the Zacks Transportation-Services industry offer transportation, logistics, leasing and maintenance services. Some industry players focus on the business of global logistics management, including international freight forwarding. Third-party logistics entities provide innovative supply-chain solutions. They also focus on services like product sourcing, warehousing and freight shipping. These companies have expertise in trucking, air and ocean transportation. Some players in this industry deliver domestic and international express delivery services. The well-being of the companies in this industrial cohort is directly proportional to the health of the economy. An uptick in manufactured and retail goods, favorable pricing and improvement in global economic conditions bode well for industry participants.
3 Trends Shaping the Future of the Transportation-Services Industry
Freight Scene on the Mend: A Big Positive: After a prolonged downturn, freight demand appears to be brightening. Highlighting the brightening freight demand scenario, the Cass Freight Shipments Index improved 5.6% month on month in August 2026. This measure has improved month on month in five of the past seven months, which confirms the improving scenario. Moreover, the shipments component of the Cass Freight Index rose 2.1% year over year in August, marking the first year-over-year gain since January 2023, ending a 42-month downturn, the longest on record.
The shrinking of capacity, as small carriers exit the market due to lackluster profitability, is resulting in a tightening of the supply-demand gap, thereby improving pricing power.
Uptick in AI Investments Support Efficiencies: Increased AI adoption and automation are significantly boosting the efficiency, safety, and profitability of transport service providers. By leveraging AI-driven predictive analytics, companies can forecast maintenance needs before vehicle breakdowns occur, drastically reducing costly fleet downtime and extending vehicle lifespans. Automated routing algorithms dynamically adjust delivery paths in real time based on traffic, weather, and fuel efficiency, allowing logistics providers to speed up delivery times while cutting fuel expenses. Additionally, AI-powered scheduling and demand forecasting help operators optimize resource allocation, ensuring that vehicles are deployed precisely when and where passenger or cargo demand is highest. Ultimately, these innovations mitigate human error, improve driver safety and enable transport providers to scale their operations smoothly in an increasingly competitive market.
Emphasis on Shareholder Returns: As economic activity rebounds from pandemic-era lows, companies are increasingly using their growing cash reserves to reward shareholders through dividends and share buybacks. This reflects both financial resilience and confidence in prospects. Within the Transportation – Services industry, Matson has raised its quarterly dividend by 5.6% this year.
Zacks Industry Rank Indicates Sunny Prospects
The Zacks Transportation - Services industry is a 20-stock group within the broader Zacks Transportation sector. The industry currently carries a Zacks Industry Rank #96, which places it in the top 39% of 247 Zacks industries.
The group’s Zacks Industry Rank, the average of the Zacks Rank of all member stocks, indicates bright near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are gradually gaining confidence in this group’s earnings growth potential. The industry's earnings estimate for 2026 has increased 7.1% since March-end.
Before we present a few stocks from the industry that you may want to buy, let’s take a look at the industry’s recent stock market performance and the valuation picture.
Industry Lags the S&P 500 and the Sector
The Zacks Transportation-Services industry has underperformed the Zacks S&P 500 composite and the broader Transportation sector in a year
The industry has remained flat over this period compared with the S&P 500's appreciation of 16.2% and the broader sector’s uptick of 16.5%
One-Year Price Performance
Industry's Current Valuation
Based on the forward 12-month price-to-sales, a commonly used multiple for valuing transportation services stocks, the industry is currently trading at 1.62X compared with the S&P 500's 4.71. The value is higher than the sector's trailing 12-month P/S of 1.5X.
Over the past five years, the industry has traded as high as 2.52X, as low as 1.48X and at the median of 1.84X.
Price-to-Sales Ratio (F12M)
3 Transport-Services Stocks to Buy Now
Expeditors, a leading third-party logistics provider, is based in Seattle, WA. The company currently sports a Zacks Rank# 1 (Strong Buy). EXPD’s earnings beat the Zacks Consensus Estimate in each of the past four quarters, with an average surprise of 17.2%.
While weak volumes (concerning air-freight tonnage and ocean containers) stemming from soft demand and declining rates are hurting EXPD’s performance, efforts to cut costs in the face of demand weakness are driving its bottom line. The company’s shareholder-friendly moves also bode well.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Price and Consensus: EXPD
Headquartered in Honolulu, HI, Matson provides ocean transportation and logistics services. We are impressed by the cost-management actions taken by the company to drive its bottom line. Matson's efforts to reward its shareholders are also commendable.
MATX currently flaunts a Zacks Rank #1. The Zacks Consensus Estimate for current-year earnings has been revised 16.1% upward over the past 60 days.
Price and Consensus: MATX
Schneider National aims to boost its earnings by leveraging productivity and asset efficiency actions while improving the top line without incremental growth investments. With the successful attainment of the cost savings target in 2025, SNDR aims to achieve another $40 million in targeted cost savings in 2026.
The company raised its 2026 adjusted earnings per share in the range of 90 cents to $1.10 from the prior view of 70 cents to $1.00. Schneider’s solid balance sheet increases financial flexibility. The Zacks Consensus Estimate for current-year earnings has been revised 14.3% upward over the past 60 days. SNDR currently carries a Zacks Rank #2 (Buy).
Price and Consensus: SNDR