Truck Stocks Plunge as Factory Slowdown Seen Curbing Cargoby
Sentiment hurt by UPS volumes, Roadrunner sales-forecast cut
Industry data are `not coming in positive,' analyst says
Investors reacted pessimistically after United Parcel Service Inc. reported a drop in third-quarter daily package volume and freight broker Roadrunner Transportation Systems Inc. cut its sales forecast, said David Campbell, an analyst with Thompson Davis & Co. The negative sentiment was exacerbated by a second straight drop in U.S. durable-goods orders in September.
“Transportation industry data is not coming in positive,” Campbell said Tuesday in a telephone interview. “They’re all going down because of what UPS said about their recent truck volume and disappointing preliminary revenue of Roadrunner.”
XPO, the freight-service company that agreed to buy Con-way Inc., fell 11 percent to $25.04 at the close in New York. YRC, a trucker that puts goods from multiple customers on each trailer, slid 11 percent to $14.64, while Roadrunner tumbled the most since its 2010 initial public offering, losing 47 percent to $9.34.
U.S. factory output has been pinched by a strong dollar that makes U.S. exports less competitive and a decline in domestic oil investment that has cut demand for steel, sand, pumps and other equipment. So-called less-than-truckload carriers like YRC can be especially dependent on industrial shipments.
Railroads, which have suffered from lower coal and oil freight, also fell on concern over declining volumes. The Standard & Poor’s 500 Railroads Index, a gauge that includes Union Pacific Corp. and CSX Corp., dropped the most since November 2014.