Old Dominion Freight Line: Solid Fundamentals but Weak Demand and Valuation Stretch Justify Hold Rating

In a report released today, Ken Hoexter from Bank of America Securities reiterated a Hold rating on Old Dominion Freight, with a price target of $165.00.

Ken Hoexter has given his Hold rating due to a combination of factors related to Old Dominion Freight Line’s operating performance and market conditions. He notes that fourth-quarter revenue trends are running weaker than normal seasonality, with October’s softness weighing on results and leading to a larger-than-usual deterioration in operating margin. While pricing per unit (revenue per hundredweight ex-fuel) is expected to increase, he anticipates a notable year-over-year decline in shipment volumes, which drives a higher operating ratio and pressures profitability.

Hoexter also highlights that, despite signs of tightening capacity in the broader truckload market, Old Dominion is not yet seeing meaningful freight spillover into its less-than-truckload network, reflecting a still-muted economic demand backdrop. This weaker demand outlook prompts him to trim his 2026 volume and earnings forecasts, even as he acknowledges the company’s best-in-class operations and financial strength. He raises his price objective modestly, based on a higher earnings multiple as profits are expected to move off cyclical lows in 2025, but believes the current share price already reflects much of this upside, supporting a neutral, or Hold, stance on the stock.

Hoexter covers the Industrials sector, focusing on stocks such as CSX, Saia, and Knight Transportation. According to TipRanks, Hoexter has an average return of 2.2% and a 49.10% success rate on recommended stocks.

In another report released on December 7, J.P. Morgan also maintained a Hold rating on the stock with a $142.00 price target.