Old Dominion Freight Line (ODFL) PT Lowered to $186 at JPMorgan

JPMorgan analyst Brian Ossenbeck lowered the price target on Old Dominion Freight Line (NASDAQ: ODFL) to $186.00 (from $191.00) while maintaining a Neutral rating.

The analyst comments "Old Dominion’s results and outlook weighed on the stock today, as the company’s 4Q24 guide confirmed the earnings revision risks we highlighted in our 3Q24 Preview when we took a negative view on the entire sub-sector (details here). Sentiment also turned negative on LTLs in recent months, and OD is often viewed as the share donor as it protects yields in a lower for longer market, the impact of which is more evident with fixed cost de-leveraging in 3Q24 results and the 4Q24 guide. OD should generate significant earnings leverage in a recovery, but after two hurricanes and a short-lived port strike failed to flip the freight market, there seems to be less excitement in the transports up-cycle trade. There are still no widespread signs that price discipline is cracking, but the incremental capacity additions across a sluggish freight market are keeping the pressure on rate renewals. This backdrop and OD’s outlook are also negative for the rest of the LTLs, but we believe ODFL is underperforming peers based on the relative valuation premium and signs of incremental cost pressure from lower volumes."

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