CSFB Revs Up Roadway Express to Buy

Analyst Gary Yablon says the trucker's operating performance has improved and its stock is selling at a discount to its peers

CS First Boston raised its investment rating of Roadway Express (ROAD ) to buy from hold because the firm thinks Roadway's operating performance has improved and its stock has underperformed other trucking stocks by 30% since the beginning of Q4 2000.

Analyst Gary Yablon said the company's $1.34 Q4 EPS was stronger than expected considering the tough freight-shipping environment. He said the stock is trading at a P/E of nine, which, given Roadway's limited history as a public company, represents a very low multiple. Yablon believes the prospect of a recession is already priced into the stock.

He sees a 2001 EPS of $3.20 and has set an upper $20s 12-month price target on the stock.

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