Oppenheimer Believes XPO Logistics (NYSE: XPO) Won’t Stop Here

In a report released today, Scott Schneeberger from Oppenheimer assigned a Buy rating to XPO Logistics (NYSE: XPO), with a price target of $85. The company’s shares closed on Friday at $74.67, close to its 52-week high of $74.90.

Schneeberger commented:

“We recently attended XPO investor meetings following strong 3Q17 results. XPO’s revenue growth/margin expansion/FCF story continue to tell well. We’re incrementally comfortable that XPO achieves/exceeds its 2018 organic revenue/adjusted EBITDA growth expectations considering strong conditions across its business lines/$2.1B of annualized revenue new business wins 3Q17-YTD/continued progress on its efficiency initiatives. Appreciating XPO’s $900M guided FCF ramp over 2017-2018, we anticipate incremental FCF enhancement thereafter as the company leverages strong adjusted EBITDA growth across a relatively consistent capex structure. Although we’re expecting XPO to transact a sizable accretive acquisition in the coming year, we’re not factoring M&A in our conservatively maintained 2017-2018 adjusted EBITDA/introduced $1.8B (+13% y/y) 2019 adjusted EBITDA estimates. Our price target increases from $77 to $85 on XPO’s healthy organic growth outlook.”

According to TipRanks.com, Schneeberger is a top 100 analyst with an average return of 14.8% and a 70.5% success rate. Schneeberger covers the Services sector, focusing on stocks such as Adtalem Global Education Inc, New Oriental Education Tech, and Service Corp International.

Currently, the analyst consensus on XPO Logistics is Strong Buy and the average price target is $80.38, representing a 7.6% upside.

In a report issued on November 6, Stifel Nicolaus also reiterated a Buy rating on the stock with a $80 price target.

Based on XPO Logistics’ latest earnings report for the quarter ending September 30, the company posted quarterly revenue of $3.89 billion and quarterly net profit of $58.2 million. In comparison, last year the company earned revenue of $3.71 billion and had a net profit of $14.5 million.

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XPO Logistics, Inc. is a transportation and logistics company, which provides comprehensive supply chain solutions to the customers. It operates its business through the Transportation and Logistics segments.