ZACKS·2026-01-16 16:31Core Viewpoint - The Zacks Transportation-Truck industry is currently facing significant challenges due to supply-chain disruptions, a weak freight environment, and macroeconomic issues, including geopolitical tensions and high inflation levels [1][4]. Industry Overview - The Zacks Transportation-Truck industry consists of truck operators that transport freight across North America, offering various services such as full-truckload and less-than-truckload (LTL) [3]. - Companies in this sector provide a range of trucking services, including dry-van, dedicated, refrigerated, flatbed, and expedited services, along with logistics and intermodal services [3]. Current Trends - Freight Downturn: The industry is experiencing a prolonged freight downturn, with the Cass Freight Shipments Index declining by 7.6% year over year in November 2025, marking a consistent decline over the past nine months [4]. - Cost Management: Companies are implementing cost-reduction strategies to combat input cost inflation and maintain margins, focusing on operational efficiency and high-growth markets [5]. - Driver Shortage: The trucking industry is facing a severe shortage of drivers, with an expected shortfall of over 160,000 drivers by 2030, exacerbating supply-chain challenges [6]. Industry Performance - The Zacks Transportation-Truck industry ranks 234 out of 243 Zacks industries, placing it in the bottom 2%, indicating poor near-term prospects [7]. - The industry's earnings estimate for 2026 has decreased by 30.9% year over year, reflecting a negative outlook among analysts [8]. - Over the past year, the industry has underperformed, declining by 3.7%, while the S&P 500 increased by 18.1% and the broader transportation sector rose by 1.4% [10]. Valuation Metrics - The industry is currently trading at an EV-to-EBITDA ratio of 14.37X, which is lower than the S&P 500's 18.99X but higher than the sector's 10.83X [13]. Notable Companies - J.B. Hunt Transport Services (JBHT): This company has seen its shares increase by 11% over the past year and has a Zacks Rank of 3 (Hold). It has surpassed earnings estimates in two of the last four quarters [17][18]. - Saia (SAIA): Saia provides regional and interregional LTL services and also holds a Zacks Rank of 3, having surpassed earnings estimates in three of the last four quarters [21][22]. - ArcBest Corporation (ARCB): ArcBest is focused on cost control and productivity improvements, expecting a 37.9% year-over-year increase in earnings per share for 2026. It also carries a Zacks Rank of 3 [24].