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Covenant Logistics Group
(NYSE:CVLG)
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Rating:49Neutral
Price Target:
$35.00
â–¼(-25.13% Downside)
Action:Reiterated
Date:08/18/26
The score is held down primarily by materially weakened profitability (very thin TTM margins) and a weak technical setup (below key moving averages with negative MACD). Valuation also detracts meaningfully due to the extremely high P/E and limited dividend yield. Offsetting factors include positive free cash flow and a cautiously constructive earnings outlook for sequential improvement and deleveraging, with corporate actions improving liquidity flexibility.
Positive Factors
Top-line growth and managed freight expansion
Growth in Managed Freight expands Covenant’s asset-light logistics platform and diversifies revenue beyond owned trucks. The acquisition and broader supply-chain offering can support customer retention and scalable growth over the next several quarters.
Negative Factors
Severely compressed profitability
Extremely thin margins leave little buffer against fuel, labor, maintenance, insurance or pricing pressure. Sustained weakness would limit earnings recovery, reduce reinvestment capacity and make results more volatile through the freight cycle.
Read all positive and negative factors
Positive Factors
Negative Factors
Top-line growth and managed freight expansion
Growth in Managed Freight expands Covenant’s asset-light logistics platform and diversifies revenue beyond owned trucks. The acquisition and broader supply-chain offering can support customer retention and scalable growth over the next several quarters.
Read all positive factors
Covenant Logistics Group Key Performance Indicators (KPIs)
Any
Revenue By Segment
Shows how much revenue each business segment generates, highlighting which areas drive growth and profitability for the company.
Shows how much revenue each business segment generates, highlighting which areas drive growth and profitability for the company.
Data provided by:
The Fly
The FlyCovenant Logistics Group (CVLG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$881.37M
Dividend Yield0.8%
Average Volume (3M)172.90K
Price to Earnings (P/E)234.7
Beta (1Y)1.04
Revenue Growth8.34%
EPS Growth-89.15%
CountryUS
Employees4,700
SectorIndustrials
Sector Strength72
IndustryTrucking
Share Statistics
EPS (TTM)0.15
Shares Outstanding20,677,778
10 Day Avg. Volume180,733
30 Day Avg. Volume172,901
Financial Highlights & Ratios
PEG Ratio-0.99
Price to Book (P/B)1.36
Price to Sales (P/S)0.47
P/FCF Ratio-16.25
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$51.75Price Target Upside10.70% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)1.71
Revenue Forecast (FY)$1.30B
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 p...
How the Company Makes Money
Covenant Logistics Group makes money primarily by selling transportation capacity and logistics services to shippers under contractual and transactional arrangements. Key revenue streams typically include: (1) Truckload transportation revenue earn...
Covenant Logistics Group Earnings Call Summary
Earnings Call Date:Jul 29, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: notable top-line gains (consolidated revenue +6.6%, Managed Freight +28.4%), improved revenue productivity per tractor, deleveraging, and a constructive strategic outlook toward committed, higher-quality revenue. Offsetting these positives were meaningful near-term margin pressures driven by a large, volatile spike in insurance and claims, higher cost-per-mile (~16%), a 19% decline in adjusted operating income, and weaker segment margins in Managed Freight and Warehouse. Management expects steady sequential improvement and a multi-quarter upcycle, but current quarter profitability was materially impacted by transitory and some structural cost pressures.Positive Updates
Consolidated Revenue Growth
Consolidated freight revenue increased 6.6% (≈ $18.2M) to $294.7M year-over-year, reflecting early-cycle demand improvement and contribution from recent acquisitions.
Negative Updates
Operating Income and Net Income Declines
Consolidated adjusted operating income declined 19% to $12.2M and adjusted net income declined 9.8% year-over-year, driven primarily by margin compression in Managed Freight and elevated costs across asset-based segments.
Read all updates
Q2-2026 Updates
Positive
Negative
Consolidated Revenue Growth
Consolidated freight revenue increased 6.6% (≈ $18.2M) to $294.7M year-over-year, reflecting early-cycle demand improvement and contribution from recent acquisitions.
Read all positive updates
Company Guidance
Guidance centered on steady, measured improvement: management expects H2 net capital equipment investment of $50–$60 million, modest further reductions in net indebtedness from the June 30 level of ~$289.7 million (adjusted leverage ~2.2x; debt‑to‑capital 41.2%), and sequential operating margin and earnings improvement (Q3 > Q2, Q4 > Q3) as contract rates catch up to capacity costs; targets include returning managed‑freight gross margin to normal, driving Dedicated and Expedited to average double‑digit adjusted operating margins over the cycle and Warehouse to high‑single digits. Key Q2 metrics to benchmark progress: consolidated freight revenue +6.6% to $294.7M, consolidated adjusted operating income down 19% to $12.2M, adjusted net income down 9.8%, trailing‑4Q ROIC 5.2% (vs 7% prior year), Managed Freight revenue +28.4%, Expedited AOR 94.6% (~+70 bps y/y) with sequential profitability +450 bps, Expedited fleet -17% but freight revenue/average tractor +6.8%, Dedicated AOR 95% with freight revenue/average tractor +8.6%, TEL pretax contribution $5.3M (vs $4.3M), while cost pressures include cost‑per‑mile up ~16%, insurance adding ~1.5–2 OR points to Dedicated/Expedited and ~1 OR point of extra maintenance on Dedicated (Q2 insurance/claims spike estimated to have impacted EPS by roughly $0.05–$0.08).Covenant Logistics Group Financial Statement Overview
Summary
Income Statement
47
Neutral
Balance Sheet
62
Positive
Cash Flow
55
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.23B | 1.16B | 1.13B | 1.10B | 1.22B | 1.05B |
| Gross Profit | 131.59M | 93.31M | 189.65M | 164.20M | 185.99M | 147.28M |
| EBITDA | 100.78M | 116.87M | 146.00M | 150.15M | 203.39M | 135.82M |
| Net Income | 3.79M | 7.24M | 35.92M | 55.23M | 108.68M | 60.73M |
Balance Sheet | ||||||
| Total Assets | 1.01B | 1.05B | 997.57M | 954.44M | 796.64M | 651.66M |
| Cash, Cash Equivalents and Short-Term Investments | 289.69M | 4.95M | 35.62M | 2.29M | 68.67M | 8.41M |
| Total Debt | 324.43M | 338.70M | 296.89M | 293.46M | 179.63M | 74.25M |
| Total Liabilities | 592.89M | 641.55M | 559.23M | 551.02M | 419.52M | 301.96M |
| Stockholders Equity | 412.87M | 404.00M | 438.34M | 403.42M | 377.13M | 349.70M |
Cash Flow | ||||||
| Free Cash Flow | 109.71M | -33.92M | -30.07M | -132.77M | 58.76M | 37.93M |
| Operating Cash Flow | 85.02M | 113.65M | 122.89M | 84.84M | 159.23M | 73.22M |
| Investing Cash Flow | -87.32M | -140.06M | -107.67M | -235.92M | -86.21M | 10.34M |
| Financing Cash Flow | 4.77M | -4.26M | 18.11M | 84.71M | -12.77M | -83.56M |
Covenant Logistics Group Technical Analysis
Neutral
46.75
Price Trends
41.75
Negative
38.00
Negative
31.20
Positive
Market Momentum
-2.24
Negative
38.22
Neutral
65.66
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CVLG, the sentiment is Neutral. The current price of 46.75 is above the 20-day moving average (MA) of 36.16, above the 50-day MA of 41.75, and above the 200-day MA of 31.20, indicating a neutral trend. The MACD of -2.24 indicates Negative momentum. The RSI at 38.22 is Neutral, neither overbought nor oversold. The STOCH value of 65.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CVLG.
Covenant Logistics Group Risk Analysis
Covenant Logistics Group disclosed 42 risk factors in its most recent earnings report. Covenant Logistics Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Covenant Logistics Group Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
58 Neutral | $3.04B | 200.49 | 1.26% | 0.31% | 3.70% | -89.58% | |
56 Neutral | $511.80M | -5.50 | -16.51% | 2.66% | -8.33% | -249.94% | |
52 Neutral | $2.28B | -50.42 | -3.39% | 1.32% | 9.64% | -190.02% | |
52 Neutral | $1.20B | 96.20 | 1.65% | 1.47% | -6.87% | -39.59% | |
49 Neutral | $881.37M | 234.67 | 0.92% | 0.60% | 8.34% | -89.15% | |
46 Neutral | $955.83M | -45.50 | -2.89% | 0.56% | -21.02% | 38.05% |
* Industrials Sector Average
CVLG
Covenant Logistics Group
35.20
10.43
42.08%
HTLD
Heartland Express
12.84
4.15
47.76%
MRTN
Marten Transport
14.93
2.77
22.79%
WERN
Werner Enterprises
38.88
9.84
33.87%
ARCB
ArcBest
140.34
63.62
82.93%
ULH
Universal Logistics
19.14
-7.37
-27.79%
Covenant Logistics Group Corporate Events
Dividends
Covenant Logistics Group Declares Quarterly Cash Dividend
Positive
Aug 17, 2026
On August 13, 2026, Covenant Logistics Group’s board of directors declared a quarterly cash dividend of $0.07 per share on its Class A and Class B common stock, continuing a previously approved dividend program. The dividend will be paid on ...
Business Operations and StrategyExecutive/Board Changes
Covenant Logistics Updates Executive Severance and Retirement Terms
Positive
Aug 7, 2026
On August 7, 2026, Covenant Logistics Group’s Compensation Committee amended severance agreements for senior executives M. Paul Bunn, James “Tripp” Grant, Dustin Koehl, and Joey Ballard to add benefits tied to retirement or volun...
Business Operations and StrategyPrivate Placements and Financing
Covenant Logistics Expands and Extends Revolving Credit Facility
Positive
Jun 23, 2026
Effective June 17, 2026, Covenant Logistics Group, Inc. and substantially all of its direct and indirect wholly owned subsidiaries executed a joinder, supplement and Twenty-First Amendment to their Third Amended and Restated Credit Agreement with ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.