Core Insights - Old Dominion Freight Line (ODFL) reported revenue of $1.41 billion for the quarter ended June 2025, reflecting a year-over-year decline of 6.1% [1] - The earnings per share (EPS) for the same period was $1.27, down from $1.48 a year ago, with an EPS surprise of -1.55% compared to the consensus estimate of $1.29 [1] - The company's revenue fell short of the Zacks Consensus Estimate of $1.42 billion, resulting in a surprise of -0.55% [1] Financial Performance Metrics - Operating Ratio was reported at 74.6%, slightly above the seven-analyst average estimate of 74.4% [4] - LTL (Less Than Truckload) tons totaled 2,123.00 KTon, compared to the four-analyst average estimate of 2,151.00 KTon [4] - LTL tonnage per day was 33.18 Kton/D, below the estimated 34.30 Kton/D [4] - LTL shipments amounted to 2,874, which is lower than the four-analyst average estimate of 2,917 [4] - LTL shipments per day were reported at 44.91 thousand, compared to the four-analyst average estimate of 45.59 thousand [4] - LTL weight per shipment was 1,478.00 lbs, slightly above the four-analyst average estimate of 1,474.69 lbs [4] - LTL revenue per hundredweight, excluding fuel surcharges, was $28.17, exceeding the average estimate of $28.09 [4] - Total revenue from LTL services was $1.4 billion, representing a year-over-year change of -6.1% and slightly above the two-analyst average estimate of $1.39 billion [4] - Total revenue from other services was $12.61 million, below the two-analyst average estimate of $14.29 million, reflecting a year-over-year change of -8.1% [4] Stock Performance - Shares of Old Dominion have returned -3.8% over the past month, contrasting with the Zacks S&P 500 composite's +3.4% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

[Earnings Announcement](index=1&type=section&id=Earnings%20Announcement) The company announced a decline in Q2 and YTD 2025 financial performance amid a soft domestic economy [Second Quarter 2025 Financial Results Overview](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Results%20Overview) The company reported a decline in Q2 and YTD 2025 financial performance due to a soft domestic economy but maintained high service quality **Key Financial Highlights (Q2 and YTD 2025 vs. 2024):** | Metric | Q2 2025 | Q2 2024 | % Chg. | YTD 2025 | YTD 2024 | % Chg. | | :-------------------------------- | :---------- | :---------- | :------- | :---------- | :---------- | :------- | | Total revenue | $1,407,724 | $1,498,697 | (6.1)% | $2,782,582 | $2,958,770 | (6.0)% | | Operating income | $357,895 | $421,691 | (15.1)% | $695,950 | $808,117 | (13.9)% | | Operating ratio | 74.6% | 71.9% | +2.7 pts | 75.0% | 72.7% | +2.3 pts | | Net income | $268,626 | $322,045 | (16.6)% | $523,286 | $614,349 | (14.8)% | | Diluted earnings per share | $1.27 | $1.48 | (14.2)% | $2.46 | $2.82 | (12.8)% | - Achieved an **on-time service performance of 99%** and a **cargo claims ratio of 0.1%**, demonstrating commitment to superior service[2](index=2&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) Management discusses the drivers behind the financial results and outlines the company's strategic focus amidst a challenging environment [Analysis of Financial Performance Drivers](index=1&type=section&id=Analysis%20of%20Financial%20Performance%20Drivers) Reduced LTL tons per day drove the revenue decrease, while disciplined yield management partially offset the impact - Decrease in second quarter revenue primarily due to a **9.3% decrease in LTL tons per day**[3](index=3&type=chunk) - LTL tons per day decrease reflects a **7.3% decrease in LTL shipments per day** and a **2.1% decrease in LTL weight per shipment**[3](index=3&type=chunk) - LTL revenue per hundredweight, excluding fuel surcharges, **increased 5.3%** compared to Q2 2024, attributed to disciplined yield management[3](index=3&type=chunk) - Operating ratio **increased by 270 basis points to 74.6%** for Q2 2025, due to revenue deleveraging, increased depreciation, and higher overhead and direct operating costs[4](index=4&type=chunk)[5](index=5&type=chunk) [Strategic Outlook and Operational Focus](index=2&type=section&id=Strategic%20Outlook%20and%20Operational%20Focus) Management remains confident in its long-term strategy, focusing on superior service, yield discipline, and network investment - Company continues to manage through a difficult operating environment that has persisted longer than anticipated[9](index=9&type=chunk) - Remains confident in long-term positioning, emphasizing **best-in-class service, yield discipline, and efficient operations**[9](index=9&type=chunk) - Consistent execution and investment in the network positions the company to capitalize on improved demand, supporting profitable revenue growth[9](index=9&type=chunk) [Capital Management and Liquidity](index=2&type=section&id=Capital%20Management%20and%20Liquidity) The company details its cash flow generation, capital expenditure plans, and significant capital returns to shareholders [Cash Flow and Capital Allocation](index=2&type=section&id=Cash%20Flow%20and%20Capital%20Allocation) The company generated strong operating cash flow, detailed its capital expenditures, and projected total spending for 2025 **Cash Flow and Cash Equivalents:** | Metric | Q2 2025 | YTD 2025 | | :-------------------------------- | :---------- | :---------- | | Net cash provided by operating activities | $285.9 million | $622.4 million | | Cash and cash equivalents (as of June 30, 2025) | $24.1 million | N/A | - Capital expenditures were **$187.2 million for Q2 2025** and **$275.3 million for the first half of the year**[7](index=7&type=chunk) - Expected aggregate capital expenditures for 2025 total approximately **$450 million**, including[7](index=7&type=chunk): - $210 million for real estate and service center expansion projects - $190 million for tractors and trailers - $50 million for information technology and other assets [Shareholder Return Programs](index=2&type=section&id=Shareholder%20Return%20Programs) The company returned significant capital to shareholders through share repurchases and cash dividends in the first half of 2025 **Capital Returned to Shareholders (First Six Months 2025):** | Program | Amount | | :---------------- | :------------- | | Share repurchases | $424.6 million | | Cash dividends | $118.5 million | [Company Information](index=4&type=section&id=Company%20Information) This section provides an overview of the company's operations as a leading North American LTL motor carrier [Business Description](index=4&type=section&id=Business%20Description) Old Dominion is a leading North American LTL carrier offering a wide range of logistics and value-added services - One of the largest North American LTL motor carriers, providing regional, inter-regional, and national LTL services[12](index=12&type=chunk) - Operates through a single integrated, union-free organization with an expansive network of service centers across the continental U.S[12](index=12&type=chunk) - Offers value-added services including expedited transportation, container drayage, truckload brokerage, and supply chain consulting[12](index=12&type=chunk) [Legal and Disclosures](index=2&type=section&id=Legal%20and%20Disclosures) This section outlines cautionary statements regarding forward-looking information and details key business and economic risks [Forward-Looking Statements and Risk Factors](index=2&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) This section contains cautionary statements on forward-looking information and highlights various risks and uncertainties - Forward-looking statements involve risks and uncertainties that could cause actual events and results to be materially different[10](index=10&type=chunk) - Key risks include challenges in executing growth strategy, changes in customer relationships, economic downturns, competition, and cyber incidents[10](index=10&type=chunk)[11](index=11&type=chunk) - The company undertakes no obligation to publicly update any forward-looking statement except as required by law[11](index=11&type=chunk) [Detailed Financial and Operating Data](index=5&type=section&id=Detailed%20Financial%20and%20Operating%20Data) This section provides unaudited financial statements and key operating statistics for the reported periods [Statements of Operations (Unaudited)](index=5&type=section&id=Statements%20of%20Operations%20(Unaudited)) Presents unaudited consolidated statements of operations for the three and six months ended June 30, 2025, and 2024 **OLD DOMINION FREIGHT LINE, INC. Statements of Operations (Unaudited):** | (In thousands, except per share amounts) | Second Quarter 2025 | % | Second Quarter 2024 | % | Year to Date 2025 | % | Year to Date 2024 | % | | :--------------------------------------- | :------------------ | :---- | :------------------ | :---- | :---------------- | :---- | :---------------- | :---- | | Revenue | $1,407,724 | 100.0% | $1,498,697 | 100.0% | $2,782,582 | 100.0% | $2,958,770 | 100.0% | | Operating expenses: | | | | | | | | | | Salaries, wages & benefits | 672,093 | 47.7% | 683,784 | 45.6% | 1,330,178 | 47.8% | 1,352,174 | 45.7% | | Operating supplies & expenses | 142,457 | 10.1% | 161,020 | 10.7% | 292,349 | 10.5% | 333,492 | 11.3% | | General supplies & expenses | 41,676 | 3.0% | 44,371 | 3.0% | 81,556 | 2.9% | 89,947 | 3.0% | | Operating taxes & licenses | 34,983 | 2.5% | 36,282 | 2.4% | 70,586 | 2.5% | 72,120 | 2.5% | | Insurance & claims | 18,794 | 1.3% | 17,141 | 1.2% | 36,274 | 1.3% | 35,335 | 1.2% | | Communications & utilities | 9,296 | 0.7% | 10,158 | 0.7% | 20,099 | 0.7% | 21,153 | 0.7% | | Depreciation & amortization | 90,663 | 6.4% | 84,563 | 5.6% | 179,795 | 6.5% | 169,094 | 5.6% | | Purchased transportation | 28,544 | 2.0% | 32,010 | 2.2% | 56,207 | 2.0% | 62,720 | 2.1% | | Miscellaneous expenses, net | 11,323 | 0.9% | 7,677 | 0.5% | 19,588 | 0.8% | 14,618 | 0.6% | | Total operating expenses | 1,049,829 | 74.6% | 1,077,006 | 71.9% | 2,086,632 | 75.0% | 2,150,653 | 72.7% | | Operating income | 357,895 | 25.4% | 421,691 | 28.1% | 695,950 | 25.0% | 808,117 | 27.3% | | Non-operating expense (income): | | | | | | | | | | Interest expense | 6 | 0.0% | 131 | 0.0% | 8 | 0.0% | 168 | 0.0% | | Interest income | (684) | (0.0)% | (5,961) | (0.5)% | (2,346) | (0.1)% | (13,333) | (0.5)% | | Other expense, net | 1,357 | 0.0% | 1,075 | 0.1% | 2,428 | 0.1% | 1,954 | 0.1% | | Income before income taxes | 357,216 | 25.4% | 426,446 | 28.5% | 695,860 | 25.0% | 819,328 | 27.7% | | Provision for income taxes | 88,590 | 6.3% | 104,401 | 7.0% | 172,574 | 6.2% | 204,979 | 6.9% | | Net income | $268,626 | 19.1% | $322,045 | 21.5% | $523,286 | 18.8% | $614,349 | 20.8% | | Earnings per share: | | | | | | | | | | Basic | $1.27 | | $1.49 | | $2.47 | | $2.83 | | | Diluted | $1.27 | | $1.48 | | $2.46 | | $2.82 | | | Weighted average outstanding shares: | | | | | | | | | | Basic | 211,083 | | 216,369 | | 211,739 | | 216,981 | | | Diluted | 212,164 | | 217,541 | | 212,821 | | 218,174 | | [Operating Statistics (Unaudited)](index=6&type=section&id=Operating%20Statistics%20(Unaudited)) Provides detailed unaudited operating statistics for the second quarter and year-to-date periods of 2025 and 2024 **OLD DOMINION FREIGHT LINE, INC. Operating Statistics (Unaudited):** | Metric | Second Quarter 2025 | Second Quarter 2024 | % Chg. | Year to Date 2025 | Year to Date 2024 | % Chg. | | :------------------------------------------ | :------------------ | :------------------ | :------- | :------------------ | :------------------ | :------- | | Work days | 64 | 64 | —% | 127 | 128 | (0.8)% | | Operating ratio | 74.6% | 71.9% | | 75.0% | 72.7% | | | LTL intercity miles (in thousands) | 159,582 | 172,361 | (7.4)% | 316,841 | 342,127 | (7.4)% | | LTL tons (in thousands) | 2,123 | 2,340 | (9.3)% | 4,211 | 4,604 | (8.5)% | | LTL tonnage per day | 33,178 | 36,560 | (9.3)% | 33,157 | 35,970 | (7.8)% | | LTL shipments (in thousands) | 2,874 | 3,100 | (7.3)% | 5,682 | 6,104 | (6.9)% | | LTL shipments per day | 44,907 | 48,444 | (7.3)% | 44,738 | 47,687 | (6.2)% | | LTL revenue per hundredweight | $32.84 | $31.77 | 3.4% | $32.76 | $31.87 | 2.8% | | LTL revenue per hundredweight, excluding fuel surcharges | $28.17 | $26.75 | 5.3% | $28.03 | $26.76 | 4.7% | | LTL revenue per shipment | $485.31 | $479.48 | 1.2% | $485.55 | $480.84 | 1.0% | | LTL revenue per shipment, excluding fuel surcharges | $416.31 | $403.77 | 3.1% | $415.50 | $403.74 | 2.9% | | LTL weight per shipment (lbs.) | 1,478 | 1,509 | (2.1)% | 1,482 | 1,509 | (1.8)% | | Average length of haul (miles) | 912 | 918 | (0.7)% | 914 | 919 | (0.5)% | | Average active full-time employees | 21,621 | 22,702 | (4.8)% | 21,719 | 22,796 | (4.7)% | [Balance Sheets (Unaudited)](index=6&type=section&id=Balance%20Sheets%20(Unaudited)) Presents the company's unaudited balance sheets as of June 30, 2025, and December 31, 2024 **OLD DOMINION FREIGHT LINE, INC. Balance Sheets (Unaudited):** | (In thousands) | June 30, 2025 | December 31, 2024 | | :-------------------------- | :-------------- | :---------------- | | Cash and cash equivalents | $24,057 | $108,676 | | Other current assets | 674,086 | 612,007 | | Total current assets | 698,143 | 720,683 | | Net property and equipment | 4,590,436 | 4,505,431 | | Other assets | 262,517 | 265,281 | | Total assets | $5,551,096 | $5,491,395 | | Current maturities of long-term debt | $20,000 | $20,000 | | Other current liabilities | 486,863 | 520,529 | | Total current liabilities | 506,863 | 540,529 | | Long-term debt | 149,992 | 39,987 | | Other non-current liabilities | 663,610 | 666,291 | | Total liabilities | 1,320,465 | 1,246,807 | | Equity | 4,230,631 | 4,244,588 | | Total liabilities & equity | $5,551,096 | $5,491,395 |

Core Viewpoint - Old Dominion Freight Line (ODFL) reported quarterly earnings of $1.27 per share, missing the Zacks Consensus Estimate of $1.29 per share, and showing a decline from $1.48 per share a year ago, indicating a negative earnings surprise of -1.55% [1][2] Financial Performance - The company posted revenues of $1.41 billion for the quarter ended June 2025, which was 0.55% below the Zacks Consensus Estimate and a decrease from $1.5 billion year-over-year [2] - Over the last four quarters, Old Dominion has surpassed consensus EPS estimates two times and topped revenue estimates two times [2] Stock Performance - Old Dominion shares have declined approximately 8.1% since the beginning of the year, contrasting with the S&P 500's gain of 8.3% [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating expectations of underperformance in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.37 on revenues of $1.46 billion, and for the current fiscal year, it is $5.11 on revenues of $5.66 billion [7] - The trend of estimate revisions for Old Dominion was unfavorable prior to the earnings release, which may impact future stock movements [5][6] Industry Context - The Transportation - Truck industry, to which Old Dominion belongs, is currently ranked in the bottom 17% of over 250 Zacks industries, suggesting potential challenges ahead [8] - The performance of Old Dominion's stock may be influenced by the overall outlook for the industry [8]

Core Insights - Old Dominion Freight Line (ODFL) is set to report its second-quarter 2025 results on July 30, with expectations of a decline in earnings and revenue compared to the previous year [1][5]. Earnings Performance - ODFL's earnings have exceeded the Zacks Consensus Estimate in three of the last four quarters, with an average surprise of 2.67% [1][2]. - The earnings per share (EPS) for Q2 2025 is projected at $1.29, reflecting a 12.84% decrease year over year, and has been revised down by 1.53% in the last 60 days [3][5]. Revenue Expectations - The revenue estimate for Q2 2025 is $1.42 billion, indicating a 5.55% decline from the previous year, attributed to weak freight demand and inflationary pressures [4][5]. - Revenue from Less-Than-Truckload (LTL) services is expected to be $1.41 billion, down 5.3%, while other services are projected to generate $16.5 million, a 20% increase year over year [7]. Market Conditions - The freight market downturn is anticipated to have significantly impacted ODFL's performance, with reduced shipments and rates due to declining demand for freight services [6][8]. - Geopolitical uncertainties and tariff-related issues are also contributing factors to the expected revenue decline [4][5]. Earnings Prediction Model - The current model does not predict an earnings beat for ODFL, as it has an Earnings ESP of -0.68% and a Zacks Rank of 4 (Sell) [8].

Group 1 - The article indicates that the LTL (Less Than Truckload) market is showing signs of recovery this year, following a previous article from April [1] - Old Dominion (NASDAQ: ODFL) is identified as the preferred carrier in the sector, noted for its leadership position [1] Group 2 - The author expresses a beneficial long position in Old Dominion shares, indicating confidence in the company's performance [2]

Group 1 - The article discusses a significant shift in the author's dividend portfolio, indicating a strategic change in investment approach [1] - The author has disclosed a beneficial long position in several companies, including TPL, LB, FIX, ODFL, GE, UNP, and CP, through various financial instruments [1] Group 2 - The article emphasizes that past performance does not guarantee future results, highlighting the inherent uncertainties in investment [2] - It clarifies that no specific investment recommendations are provided, and opinions expressed may not represent the views of Seeking Alpha as a whole [2]

Group 1: Investment Opportunities - The article highlights three dividend growth stocks that are currently undervalued, with share prices down between 19% and 26% from their highs, presenting a buying opportunity for investors [2][3] Group 2: Zoetis - Zoetis is a leading company in the animal healthcare industry, offering a variety of products including medicines and vaccines, and has outperformed the S&P 500 since its IPO in 2013 [3][4] - The company's valuation peaked at an average of 47 times free cash flow (FCF) over the last decade, but has now adjusted to a more reasonable 31 times FCF, with a dividend yield of 1.2% [4][5] - Zoetis has a return on invested capital (ROIC) of 22%, indicating strong growth potential through new product introductions and lifecycle innovations [7] - The company has achieved a 28% growth in FCF and an 18% increase in dividend payments annually over the last decade, making it a strong compounder [8] - Recent sales growth in parasiticides, dermatology, and pain products exceeding 10% suggests continued rewards for dividend investors [9] Group 3: Pool Corp. - Pool Corp. is the largest distributor of pool products globally and has seen significant growth since its IPO in 1995, but its share price has stagnated recently due to economic factors [11] - The company generates 64% of its sales from non-discretionary maintenance and repair, providing stability amid cyclical downturns [12] - Despite challenges, Pool Corp. generated nearly $500 million in FCF last year and has utilized this to repurchase shares, with its stock down 23% from year-long highs [13] - The company has an average ROIC of 18%, demonstrating its ability to navigate economic cycles profitably [14] - Pool Corp. currently offers a 1.6% dividend yield, the highest since 2012, with only 38% of FCF used for dividends, indicating potential for future growth [15] Group 4: Old Dominion Freight Line - Old Dominion Freight Line specializes in less-than-truckload (LTL) hauling and has been a strong performer since its IPO in 1991, though it is also subject to cyclical fluctuations [16][18] - The company has experienced a 26% drop in stock price due to a freight industry recession and weak industrial shipments [18] - Old Dominion boasts a leading ROIC, allowing it to gain market share and repurchase shares during economic downturns [20] - The company has reduced its share count by more than one-sixth over the last decade, and while its dividend yield is currently 0.6%, it has grown by 33% over the past five years, utilizing only 27% of FCF [21]

Company Overview - Old Dominion Freight Line (ODFL) has a market capitalization of approximately $35 billion[6] - The company generated $5.8 billion in revenue in 2024[6] - ODFL is the 2nd largest LTL (Less-Than-Truckload) carrier with a 12% to 13% market share[6] - As of March 31, 2025, ODFL has 21,818 full-time active non-union employees, 10,735 tractors, and 46,260 trailers[6,7] - The company operates 261 service centers across 48 states[6] Financial Performance & Strategy - ODFL focuses on growing market segments, delivering superior customer service, and maintaining pricing discipline[14] - The company aims to maintain a strong financial position and take care of its employees[14] - From 2014-2024, ODFL invested $2.5 billion in service center additions and expansions, increasing service centers by 18% and door count by 50%[14] - Capital expenditures are typically between 10% to 15% of total annual revenue[30] Operational Excellence - ODFL's on-time service has improved from 94% in 2002 to 99% in 2024[14] - The cargo claims ratio has declined from 1.5% in 2002 to 0.1% in 2024[14] Q1 2025 Financial Highlights - Revenue decreased by 5.8%[50] - The operating ratio increased by 190 basis points to 75.4%[50] - Diluted earnings per share decreased by 11.2%[50]

Group 1 - Old Dominion Freight Line (NASDAQ: ODFL) has faced challenges over the past year due to prolonged high interest rates, leading to increased operating costs and decreased freight volumes [1] - The company operates as a less-than-truckload (LTL) carrier, which has been impacted by these economic conditions [1] Group 2 - The article emphasizes the importance of conducting personal due diligence before making investment decisions, particularly in the context of dividend investing and building quality portfolios [1]

Core Viewpoint - Old Dominion Freight Line, Inc. (ODFL) appears unattractive from a valuation perspective, with a forward 12-month price-to-sales ratio (P/S-F12M) of 5.69X compared to the industry average of 1.77X [1] Group 1: Financial Performance - ODFL has a Value Score of F, raising questions about whether to buy, hold, or sell the stock at current prices [5] - The company ended Q1 2025 with cash and equivalents of $97 million, significantly higher than its current debt level of $20 million, indicating strong financial flexibility [7] - Long-term debt decreased from $60 million (1.8% debt-to-capitalization) at the end of Q1 2024 to $40 million (1.4% debt-to-capitalization) at the end of Q1 2025 [7] - ODFL paid dividends of $175.1 million and repurchased shares worth $453.6 million in 2023, with dividends of $267.6 million and share repurchases of $967.3 million in 2024 [11][12] Group 2: Market Position and Strategy - ODFL's disciplined pricing strategy has allowed it to retain customers and maintain tonnage, with LTL revenue per hundredweight improving by 2.4% in 2024 despite weak demand [6] - The company’s strong balance sheet enables it to reward shareholders through dividends and share buybacks, which should enhance investor confidence [11][12] - ODFL's stock has declined by 9.3% year-to-date, which is better than the transportation-truck industry's decline of 17.3% [13] Group 3: Challenges and Risks - ODFL faces challenges from reduced demand for freight services, leading to low shipment volumes and rates, which negatively impacts revenues [15] - The operating ratio deteriorated from 72% in 2023 to 73.4% in 2024, despite cost-cutting efforts [15] - The trucking industry continues to struggle with a driver shortage, exacerbated by economic uncertainty and high inflation affecting consumer sentiment [16]