Why Old Dominion Freight Line Shares Are Slumping Today
Portfolio Pulse from Lekha Gupta
Old Dominion Freight Line, Inc. (NASDAQ:ODFL) shares dropped after reporting a first-quarter FY24 revenue miss, with a slight increase in revenue not meeting expectations. The company saw a 1.2% year-over-year revenue increase to $1.460 billion, missing the consensus of $1.473 billion, attributed to a mix of a rise in LTL revenue per hundredweight and a decrease in LTL tons per day. Operating income slightly increased, and EPS was in line with consensus. The company also returned significant amounts to shareholders through repurchases and dividends. Exposure to ODFL can also be gained through IShares Trust IShares U.S. Transportation ETF (BATS:IYT) and ProShares Trust ProShares Supply Chain Logistics ETF (NYSE:SUPL).
April 24, 2024 | 4:50 pm
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NEUTRAL IMPACT
Investors can gain exposure to ODFL through the IShares Trust IShares U.S. Transportation ETF (IYT), which may be indirectly affected by ODFL's performance.
IYT, as a transportation ETF that includes ODFL, may experience indirect impact due to ODFL's performance. However, the diversified nature of the ETF could mitigate the direct impact of ODFL's revenue miss on the ETF's overall performance.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
NEUTRAL IMPACT
ProShares Trust ProShares Supply Chain Logistics ETF (SUPL) offers another avenue for exposure to ODFL, potentially impacted by ODFL's recent performance.
SUPL, focusing on supply chain logistics, including companies like ODFL, may see an indirect impact from ODFL's earnings miss. The effect on SUPL would depend on the weight of ODFL within the ETF and the performance of other holdings.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
Old Dominion Freight Line reported a Q1 FY24 revenue miss, causing its shares to drop by 10.9%. The company saw a minor revenue increase and maintained its shareholder return programs.
The direct impact on ODFL's stock price is due to the reported revenue miss for Q1 FY24, which led to a significant drop in share price. The slight increase in revenue and operating income, along with continued shareholder returns, were not enough to offset the negative sentiment.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100