Rothschild starts Old Dominion with Sell on diminishing returns

As previously reported, Rothschild & Co Redburn analyst Oliver Holmes initiated coverage of Old Dominion (ODFL) with a Sell rating and $114 price target. The firm believes the company will see diminishing returns from its investments as its network, service levels and margin profile are getting closer to maturity. Old Dominion will “remain best in class for a prolonged period,” but the rate of change will hurt its growth and valuation relative to peers, the analyst told investors in a research note. Old Dominion shares are up 74c to $135.07 in morning trading. Rothschild also initiated XPO, Inc (XPO) with a Buy rating and $156 price target, citing the company’s margin expansion potential, and Saia (SAIA) with a Neutral rating and $262 price target given its “growing pains and mix-derived margin softness.”