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Covenant Logistics (CVLG) Stock Sinks As Market Gains: What You Should Know

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Covenant Logistics (CVLG - Free Report) closed the most recent trading day at $32.57, moving -1.66% from the previous trading session. This move lagged the S&P 500's daily gain of 0.89%. Elsewhere, the Dow gained 1.2%, while the tech-heavy Nasdaq lost 0.68%.

Prior to today's trading, shares of the truckload transportation services provider had lost 5.24% over the past month. This has lagged the Transportation sector's loss of 4.65% and the S&P 500's loss of 3.9% in that time.

Investors will be hoping for strength from Covenant Logistics as it approaches its next earnings release. In that report, analysts expect Covenant Logistics to post earnings of $0.77 per share. This would mark a year-over-year decline of 42.96%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $256 million, down 12.21% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.77 per share and revenue of $1.06 billion. These totals would mark changes of -35.45% and -12.99%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Covenant Logistics. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Covenant Logistics is currently a Zacks Rank #4 (Sell).

Valuation is also important, so investors should note that Covenant Logistics has a Forward P/E ratio of 8.79 right now. This represents a discount compared to its industry's average Forward P/E of 15.15.

The Transportation - Truck industry is part of the Transportation sector. This group has a Zacks Industry Rank of 193, putting it in the bottom 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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