Stephens downgrades Saia to Equal Weight on yield underperformance

Stephens downgraded Saia (SAIA) to Equal Weight from Overweight with a price target of $255, down from $515. The firm says softer March shipments and yields drove an operating ratio miss in Q1. Saia was unable to adjust costs to match the lower volumes late in the quarter and while the company continues its efforts to reprice freight, shippers have moved business to lower-priced competitors, the analyst tells investors in a research note. Stephens believes this could take longer to improve service enough to win back share and support yield growth. As such, it cut intermediate-term yield assumptions and downgraded the shares. The continued operating ratio misses and yield underperformance “could make it difficult for shares to break out of this range in the coming quarters,” contends the firm.