Old Dominion Freight Line, Inc. ODFL shares fell slightly on Friday. BMO Capital Markets analyst Fadi Chamoun downgraded the stock from Outperform to Market Perform, reducing the price target from $214 to $210.
Chamoun noted that earnings expectations for 2025 have dropped by 13% to 15%, and demand remains weak. The recovery in freight markets is taking longer than expected.
The downgrade signals anticipated negative changes as the recovery is pushed further out.
Industrial demand, which makes up two-thirds of LTL traffic, is still slow. While lower interest rates should help volumes eventually, the recovery is now expected in the second half of 2025 or later.
Given high valuations, there’s limited safety in the short term, Chamoun added.
The analyst cut the FY25 earnings forecast by 2.5% to $6.00 (compared to $6.27 consensus) and FY26 by 3.3% to $7.06 (versus $7.15 consensus).
Investors can access the stock through the First Trust S&P 500 Diversified Dividend Aristocrats ETF IYT and ProShares Trust ProShares Supply Chain Logistics ETF SUPL.
Price Action: ODFL shares decreased by 0.82%, trading at $199.86 as of the last check Friday.
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