Landstar Continues to Grapple With Weakness in Freight Market

Industry Overview - The trucking industry faces a major challenge due to a driver shortage, as older drivers retire and younger generations show less interest in the profession [2] - The Cass Freight Shipment Index declined 0.7% year over year in November, reflecting weak freight demand and a declining trend since January 2024 [1] Company Performance (Landstar System, Inc. - LSTR) - LSTR is experiencing multiple headwinds, including reduced demand for freight services and increased truck capacity, making it an unimpressive investment option [4] - The company's top line is suffering due to low shipment volumes and rates, primarily driven by the below-par performance of its truck transportation segment [5] - LSTR's shares have plunged 10.1% year-to-date, significantly underperforming the industry's loss of 0.4% [6] - The Zacks Consensus Estimate for LSTR's Q4 2024 earnings has been revised downward by 18.1%, and full-year 2024 earnings by 5.1% over the past 90 days [3] - LSTR's earnings are expected to decline 16.1% year over year in Q4 2024 and 24.3% for the full year 2024 [8] - The company currently carries a Zacks Rank 4 (Sell) and has a Value Score of D, indicating its unattractiveness [11] Alternative Investment Opportunities - C H Robinson Worldwide Inc (CHRW) and Wabtec Corporation (WAB) are better-ranked stocks in the Zacks Transportation sector, each carrying a Zacks Rank 2 (Buy) [9] - CHRW has an impressive earnings surprise history, with earnings outpacing the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average surprise of 10.29% [13] - The Zacks Consensus Estimate for CHRW's 2024 earnings has been revised upward by 6.4% over the past 90 days, with an expected earnings growth rate of 33.3% for 2024 [13] - CHRW's shares have gained 21.6% year-to-date [13] - WAB has an impressive earnings surprise history, with earnings outpacing the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average surprise of 9.46% [10] - The Zacks Consensus Estimate for WAB's 2024 earnings has been revised upward by 2.5% over the past 90 days, with an expected earnings growth rate of 28.55% for 2024 [14] - WAB's shares have gained 49.4% year-to-date [14]