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Old Dominion Shares Gain on Upbeat Q3 LTL Segment Update

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Old Dominion Freight Line, Inc. (ODFL - Free Report) has issued an update on the performance of its less-than-truckload (LTL) segment (generating major share of revenues) giving an idea of its likely third-quarter results.

Per the company, LTL tons per day climbed 9.7% year over year in August, primarily owing to 10% increase in LTL shipments per day. This takes into account the negative impact of 0.3% decline in LTL weight per shipment. Additionally, LTL revenue per hundredweight rose 12% year over year so far this quarter.

Per Greg C. Gantt, Old Dominion’s president and chief executive officer, the company’s revenues improved more than 20%, both in July and August on consistent strength in domestic economy as well as its constant efforts to deliver premier service at a reasonable price.


Although LTL volume growth on a quarter-to-date basis fell marginally below what the company achieved in the first half of the year, the adversity had a favorable bearing on the LTL revenue per hundredweight. The downside in LTL volume growth was mainly due to reduced heavy-weight shipments in the company’s network.

Demand for the company’s services remains strong and its service center network capacity is anticipated to suffice business growth at least in the near term. The company aims at boosting investor confidence through steady reinvestments in its business, thereby supporting the company’s long-term interests.

The bullish third-quarter picture has pleased investors. Consequently, shares of the company gained 4.1% at the close of business on Sep 6.

Zacks Rank & Other Key Picks

Old Dominion carries a Zacks Rank #2 (Buy). Other top-ranked stocks in the broader Transportation sector include SkyWest, Inc (SKYW - Free Report) , C.H. Robinson Worldwide, Inc. (CHRW - Free Report) and Trinity Industries, Inc. (TRN - Free Report) . While C.H. Robinson holds a Zacks Rank of 2, SkyWest and Trinity sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of SkyWest, C.H. Robinson and Trinity have rallied more than 69%, 32% and 26%, respectively, in a year.

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