XPO Logistics (XPO) PT Raised to $137 at Oppenheimer

Oppenheimer analyst Scott Schneeberger raised the price target on XPO Logistics (NYSE: XPO) to $137.00 (from $123.00) while maintaining an Outperform rating.

The analyst commented, "Highlighting XPO as a top-pick heading into 2021, we're increasing our target from $123 to $137. Business conditions appear to be trending favorably via increasing volumes/solid pricing in North American LTL, technology-driven outperformance in a sustained healthy Truck Brokerage market environment, and secular trends (supply chain outsourcing/e-commerce) benefiting Contract Logistics/Last Mile. We view XPO undervalued on a sum-of-the-parts basis and anticipate its recently announced 2H21 planned spin-off of Contract Logistics (NewCo) should prompt progressively higher multiples attributed to it and Transportation (RemainCo) as separate entities relative to the valuation it currently derives as a conglomerate. XPO appears excessively-discounted relative to key peers, and our increased $137 target attributes a seemingly conservative 11.5x EV/EBITDA multiple to our increased 2021E adjusted EBITDA of $1.7B (from $1.644B)."

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