Covenant Logistics Group (CVLG) AI Stock Analysis

• Market Cap: $505.65M
• Dividend Yield: 1.37%
• Average Volume (3M): 101.65K
• Price to Earnings (P/E): 17.0
• Beta (1Y): 1.21
• Revenue Growth: 1.62%
• EPS Growth: -22.52%
• Country: US
• Employees: 3,100
• Sector: Industrials
• Sector Strength: 72
• Industry: Trucking
• EPS (TTM): 0.44
• Shares Outstanding: 20,319,618
• 10 Day Avg. Volume: 78,408
• 30 Day Avg. Volume: 101,648
• PEG Ratio: -0.56
• Price to Book (P/B): 1.64
• Price to Sales (P/S): 0.63
• P/FCF Ratio: -23.85
• Enterprise Value/Market Cap: 1.91
• Enterprise Value/Revenue: 0.85
• Enterprise Value/Gross Profit: 5.29
• Enterprise Value/Ebitda: 6.57
• 1Y Price Target: $27.00
• Price Target Upside: 39.10% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 59 Neutral
• Price Target: $21.00 ▲(8.19% Upside)

Covenant Logistics Group's overall stock score is primarily impacted by its stable financial performance and operational efficiency. However, increased leverage, declining free cash flow, and weak technical indicators present significant risks. The earnings call provided mixed signals, with some growth but also notable challenges.

Positive Factors

Revenue Growth

The consistent revenue growth, driven by the dedicated fleet and Managed Freight, indicates strong demand and effective service offerings, supporting long-term business expansion.

Dedicated Fleet Expansion

The expansion of the dedicated fleet enhances capacity and service reliability, positioning the company to capture more market share and improve customer satisfaction.

Managed Freight Performance

Exceeding expectations in Managed Freight reflects strong operational execution and adaptability, contributing to diversified revenue streams and resilience against market fluctuations.

Negative Factors

Increased Debt Levels

Rising debt levels can strain financial resources and limit strategic flexibility, posing risks to long-term financial health and investment capacity.

Margin Compression

Margin compression due to rising costs reduces profitability, challenging the company's ability to maintain competitive pricing and invest in growth initiatives.

Warehouse Segment Profit Decline

Significant profit decline in the Warehouse segment highlights operational inefficiencies and cost management challenges, potentially impacting overall profitability.

Covenant Logistics Group Business Overview & Revenue Model

Company Description

Covenant Logistics Group, Inc., together with its subsidiaries, provides transportation and logistics services in the United States. It operates through four segments: Expedited, Dedicated, Managed Freight, and Warehousing. The Expedited segment primarily provides truckload services with high service freight and delivery standards, such as 1,000 miles in 22 hours or 15-minute delivery windows. The Dedicated segment provides customers with committed truckload capacity over contracted periods using equipment either owned or leased by the company. The Managed Freight segment offers brokerage services, including logistics capacity by outsourcing the carriage of customers' freight to third parties; and transport management services, such as logistics services on a contractual basis to customers who prefer to outsource their logistics needs. The Warehousing segment provides day-to-day warehouse management services to customers. The segment also provides shuttle and switching services to shuttling containers and trailers. The company also engages in used equipment sales and leasing business. It serves transportation companies, such as parcel freight forwarders, less-than-truckload carriers, and third-party logistics providers; and traditional truckload customers, including manufacturers, retailers, and food and beverage shippers. As of December 31, 2021, it operated 2,291 tractors and 5,331 trailers. The company was formerly known as Covenant Transportation Group, Inc. and changed its name to Covenant Logistics Group, Inc. in July 2020. Covenant Logistics Group, Inc. was founded in 1986 and is based in Chattanooga, Tennessee.

How the Company Makes Money

Covenant Logistics Group generates revenue primarily through its transportation services, which include truckload and dedicated freight services. The company earns money by charging customers for the movement of goods, utilizing its fleet of trucks and drivers. Key revenue streams include spot market freight, contracted freight services, and logistics management services. Additionally, CVLG benefits from strategic partnerships with various shippers and suppliers, which enhance its service offerings and improve operational efficiency. The company may also leverage technology and data analytics to optimize routes and reduce costs, further contributing to its earnings.

Covenant Logistics Group Financial Statement Overview

Summary

Covenant Logistics Group shows stable revenue growth and operational efficiency, but increased leverage and declining free cash flow growth pose risks. The company needs to improve cash flow conversion and manage debt levels to enhance financial stability.

Income Statement

Covenant Logistics Group shows a stable revenue growth trajectory with a slight increase in gross profit margins over the TTM. However, the net profit margin has slightly decreased, indicating some pressure on profitability. The EBIT and EBITDA margins are stable, reflecting consistent operational efficiency.

Balance Sheet

The company's debt-to-equity ratio has increased over the years, indicating higher leverage, but it remains at a manageable level. Return on equity has decreased compared to previous years, suggesting a decline in profitability relative to equity. The equity ratio indicates a stable capital structure.

Cash Flow

The cash flow statement reveals a significant decline in free cash flow growth, which is a concern. The operating cash flow to net income ratio is healthy, but the free cash flow to net income ratio is low, indicating potential issues in converting income into free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.14B	1.13B	1.10B	1.22B	1.05B	838.56M
Gross Profit	182.66M	189.65M	164.20M	185.99M	147.28M	109.55M
EBITDA	147.23M	146.00M	150.15M	137.87M	117.24M	70.32M
Net Income	36.16M	35.92M	55.23M	108.68M	60.73M	-42.72M
Balance Sheet
Total Assets	1.01B	997.57M	954.44M	796.64M	651.66M	676.72M
Cash, Cash Equivalents and Short-Term Investments	268.69M	35.62M	2.29M	68.67M	8.41M	8.41M
Total Debt	310.54M	296.89M	293.46M	179.63M	74.25M	111.59M
Total Liabilities	592.22M	559.23M	551.02M	419.52M	301.96M	386.07M
Stockholders Equity	416.87M	438.34M	403.42M	377.13M	349.70M	290.64M
Cash Flow
Free Cash Flow	1.60M	-30.07M	-132.77M	58.76M	37.93M	-31.01M
Operating Cash Flow	125.53M	122.89M	84.84M	159.23M	73.22M	63.04M
Investing Cash Flow	-74.73M	-107.67M	-235.92M	-86.21M	10.34M	138.05M
Financing Cash Flow	-51.94M	18.11M	84.71M	-12.77M	-83.56M	-236.27M

Covenant Logistics Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 19.41
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CVLG, the sentiment is Negative. The current price of 19.41 is below the 20-day moving average (MA) of 20.63, below the 50-day MA of 21.82, and below the 200-day MA of 23.03, indicating a bearish trend. The MACD of -0.56 indicates Positive momentum. The RSI at 34.51 is Neutral, neither overbought nor oversold. The STOCH value of 27.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CVLG.

Covenant Logistics Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
ARCB	62 Neutral	$1.61B	16.79	7.40%	0.65%	-5.34%	-48.16%
CVLG	59 Neutral	$505.65M	17.02	6.84%	1.37%	1.62%	-22.52%
WERN	59 Neutral	$1.57B	64.63	1.78%	2.19%	-3.42%	―
ULH	57 Neutral	$425.49M	6.98	9.67%	2.74%	-5.55%	-52.21%
MRTN	54 Neutral	$816.02M	42.09	2.53%	2.45%	-9.74%	-42.57%
HTLD	48 Neutral	$597.59M	―	-4.35%	1.05%	-19.56%	-54.39%

Covenant Logistics Group Corporate Events

Covenant Logistics Reports Mixed Q3 2025 Results

Covenant Logistics Group, Inc. is a transportation and logistics company providing asset-based and asset-light services across the United States, including truckload capacity, warehousing, and freight brokerage. In its third-quarter 2025 earnings report, Covenant Logistics reported a mixed financial performance with a slight increase in total revenue to $296.9 million, up 3.1% from the previous year. However, the company’s net income decreased to $9.1 million from $13.0 million in the same quarter last year, reflecting challenges in its Truckload business due to higher costs and under-utilized equipment. The company’s Truckload segment saw a modest revenue increase of 0.3%, while the Expedited segment experienced an 8.2% decline in freight revenue. The Dedicated segment, however, showed a strong performance with a 10.8% increase in freight revenue. Covenant’s Managed Freight segment reported a 14% increase in freight revenue, while the Warehousing segment remained relatively stable. Looking ahead, Covenant Logistics anticipates short-term challenges, including lower profits from its minority investment in TEL and potential impacts from external factors. However, the company remains optimistic about long-term growth opportunities, particularly in its dedicated and warehouse business segments, as it continues to adapt its operations to improve returns.

Covenant Logistics Announces New Accounting Officer

On August 11, 2025, Matisse Long resigned as the Chief Accounting Officer of Covenant Logistics Group, Inc., and the Board of Directors appointed James ‘Tripp’ S. Grant as the new principal accounting officer, effective immediately. Additionally, on August 12, 2025, the Board declared a quarterly cash dividend of $0.07 per share for Class A and Class B common stock, payable on September 26, 2025, to stockholders of record as of September 5, 2025, continuing a previously approved dividend program.

The most recent analyst rating on (CVLG) stock is a Buy with a $34.00 price target. To see the full list of analyst forecasts on Covenant Logistics Group stock, see the CVLG Stock Forecast page.

Covenant Logistics Reports Record Freight Revenue Amidst Competitive Market

Covenant Logistics Group, Inc. is a transportation and logistics company offering services such as expedited and dedicated truckload capacity, warehousing, transportation management, and freight brokerage across the United States. In its latest earnings report for the second quarter of 2025, the company achieved a record freight revenue of $276.5 million, marking a 7.8% increase year-over-year. Despite a competitive operating environment, Covenant also repurchased 1.6 million shares of its common stock, amounting to $35.2 million. Key financial metrics showed a slight decline in net income to $9.84 million from $12.19 million in the previous year, while adjusted earnings per diluted share were $0.45, down from $0.52. The company’s Managed Freight segment saw a significant revenue increase of 28.5%, driven by new business and overflow capacity. However, rising operating costs impacted margins in the truckload segment. Looking forward, Covenant remains optimistic about improving market fundamentals and is focused on expanding its dedicated fleet and exploring acquisition opportunities to drive growth and shareholder returns.

Covenant Logistics Q2 Earnings Call: Balancing Growth and Challenges

Covenant Logistics Group, Inc. recently held an earnings call that painted a picture of both triumphs and trials. The company celebrated record revenue and growth in its dedicated fleet, alongside success in the Managed Freight segment. However, these achievements were tempered by challenges such as compressed margins, difficulties in the Expedited segment, and a significant decline in the Warehouse segment’s operating profit. The overall sentiment of the call was neutral, balancing positive growth with ongoing challenges.