C.H. Robinson has a troublesome highway forward in 2023, in response to JPMorgan. Analyst Brian Ossenbeck downgraded the inventory to underweight from impartial. The analyst named rail congestion charges, truckload price cycles and coal volumes as headwinds for the corporate in 2023 regardless of an bettering business outlook. “C.H. Robinson’s main North American Floor Transportation phase stays considerably uncovered to the unfold between contract and spot truckload charges in addition to the timing of contract negotiations and general freight market demand,” the analyst mentioned in a Friday notice. The downgrade got here after C.H. Robinson reported its newest quarterly outcomes earlier this month. Each the corporate’s earnings and income got here in nicely under expectations. The analyst famous that C.H. Robinson is extra uncovered to broader business and macro dangers than a few of its rivals, notably RXO. “RXO was capable of develop brokerage quantity by 4% YoY throughout 4Q22 and expects to point out progress once more in 1Q23 on a YoY foundation whereas Robinson’s truckload quantity progress has underperformed its typical Cass Freight benchmark over the past two quarters,” the analyst mentioned. The inventory has jumped 13.3% in 2023 after falling greater than 14% final 12 months. Nonetheless, JPMorgan thinks that there are nonetheless important draw back dangers to the inventory regardless of its latest good points. Ossenbeck reiterated his worth goal of $87, which suggests a 16.1% draw back from the inventory’s closing worth on Thursday. “There wasn’t a lot to jot down dwelling about after the 4Q22 earnings name after administration signaled the present technique would keep the course and never put the World Forwarding enterprise up on the market any time quickly even after the previous CEO (who opposed the sale) was fired at the start of 2023,” mentioned Ossenbeck. —CNBC’s Michael Bloom contributed to this report.
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