Covenant Logistics Group (CVLG)
NYSE:CVLG
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Covenant Logistics Group
(NYSE:CVLG)
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Rating:60Neutral
Price Target:
$28.00
▲(29.57% Upside)
Action:ReiteratedDate:02/28/26
CVLG scores as moderate: the biggest positive is improved financial flexibility and solid operating cash flow, but this is tempered by sharp margin/return deterioration and volatile free cash flow. Technicals are supportive with an uptrend and positive momentum. Valuation is a clear headwind given the very high P/E, and the latest call was mixed—early pricing signs and an accretive acquisition are positives, but profitability and leverage improvement still need to be proven.
Positive Factors
Materially Improved Leverage
Reported elimination of term debt materially strengthens financial flexibility, lowering fixed financing costs and raising capacity to fund operations, buybacks or small M&A without relying on new borrowing. This durability helps the company withstand cycles and execute strategic plans over months.
Negative Factors
Severe Margin Compression
A multi-year collapse in margins and ROE signals structural pricing pressure or rising cost base. Persistent low profitability weakens reinvestment capacity and return on capital, making sustained growth and shareholder returns harder unless the company restores pricing power or materially cuts structural costs.
Read all positive and negative factors
Positive Factors
Negative Factors
Materially Improved Leverage
Reported elimination of term debt materially strengthens financial flexibility, lowering fixed financing costs and raising capacity to fund operations, buybacks or small M&A without relying on new borrowing. This durability helps the company withstand cycles and execute strategic plans over months.
Read all positive factors
Covenant Logistics Group (CVLG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$693.80M
Dividend Yield1.23%
Average Volume (3M)101.65K
Price to Earnings (P/E)76.1
Beta (1Y)1.18
Revenue Growth1.62%
EPS Growth-22.52%
CountryUS
Employees3,100
SectorIndustrials
Sector Strength72
IndustryTrucking
Share Statistics
EPS (TTM)0.31
Shares Outstanding20,383,043
10 Day Avg. Volume78,408
30 Day Avg. Volume101,648
Financial Highlights & Ratios
PEG Ratio-0.96
Price to Book (P/B)1.36
Price to Sales (P/S)0.47
P/FCF Ratio-16.25
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue0.64
Enterprise Value/Gross Profit5.35
Enterprise Value/Ebitda6.41
Forecast
1Y Price Target
$30.00Price Target Upside38.82% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)2.01
Revenue Forecast (FY)$1.22B
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 by selling transportation capacity and logistics services to shippers under a mix of contract and transactional arrangements. Key revenue streams generally include: (1) Dedicated contract carriage: multi-year o...
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 Earnings Call Summary
Earnings Call Date:Jan 29, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: encouraging top-line momentum (7.8% revenue growth), improving market signals in early January (≈3.5% initial rate gains and bids up 33%), Dedicated segment strength, and a strategic acquisition expected to be accretive. Offsetting these positives were substantial margin pressures (adjusted operating income down 39.4%), elevated net indebtedness and leverage, equipment-market write-downs and underused assets, and near-term operational headwinds in Expedited and Warehousing. Management has a clear plan (fleet optimization, modest 2026 CapEx, focusing on higher-yield freight, and leveraging the Star acquisition) and early market signs are constructive, but material profitability and balance-sheet improvements remain to be realized.Positive Updates
Consolidated Revenue Growth
Consolidated freight revenue increased 7.8% year-over-year (≈+$19.5M) to $270.6M in Q4 2025, reflecting top-line momentum despite other pressures.
Negative Updates
Sharp Decline in Adjusted Operating Income
Consolidated adjusted operating income declined 39.4% year-over-year to $10.9M in Q4 2025, reflecting margin compression across multiple segments despite revenue growth.
Read all updates
Q4-2025 Updates
Positive
Negative
Consolidated Revenue Growth
Consolidated freight revenue increased 7.8% year-over-year (≈+$19.5M) to $270.6M in Q4 2025, reflecting top-line momentum despite other pressures.
Read all positive updates
Company Guidance
The company guided that freight fundamentals are improving — spot rates rose and the first three weeks of January show ~3.5% average rate improvement with bid activity up ~33% versus Q4 — and management expects additional low- to mid-single-digit rate increases to take effect in Q1 and early Q2; they acquired Star (to be accretive in H1 2026) and see Managed Freight stabilizing around mid-single-digit operating margins over time. They signaled a deliberate equipment and capital plan: moved assets to held‑for‑sale with lowered disposition price expectations, plan a modestly smaller fleet by year‑end 2026 (Expedited trimming roughly ~25 tractors/quarter while Dedicated grew ~90 tractors or ~6.3% year‑over‑year), and target only $40–50 million of net CapEx in 2026 to reduce leverage. Financial targets and recent metrics include consolidated freight revenue of $270.6M (+7.8% or ≈$19.5M), consolidated adjusted operating income of $10.9M (-39.4%), net indebtedness of $296.6M (+$76.9M) yielding adjusted leverage ~2.3x and debt‑to‑capital 42.3%, return on average invested capital of 5.6% (vs. 8.1% prior year), segment ORs of 97.2% (Expedited) and 92.2% (Dedicated) with long‑run goals of Expedited in the 80s and Dedicated ~88–90%, warehousing revenue up 4.6% ($1.1M) but adj. operating income down $1.6M, and TEL pre‑tax income of $3.1M for the quarter; overall the theme is execution to improve returns, reduce balance‑sheet leverage and capture operating leverage as 2026 demand/market dynamics strengthen.Covenant Logistics Group Financial Statement Overview
Summary
Income Statement
52
Neutral
Balance Sheet
70
Positive
Cash Flow
63
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.16B | 1.13B | 1.10B | 1.22B | 1.05B |
| Gross Profit | 93.31M | 189.65M | 164.20M | 185.99M | 147.28M |
| EBITDA | 116.87M | 146.00M | 150.15M | 137.87M | 117.24M |
| Net Income | 7.24M | 35.92M | 55.23M | 108.68M | 60.73M |
Balance Sheet | |||||
| Total Assets | 1.10B | 997.57M | 954.44M | 796.64M | 651.66M |
| Cash, Cash Equivalents and Short-Term Investments | 296.30M | 35.62M | 2.29M | 68.67M | 8.41M |
| Total Debt | 338.70M | 296.89M | 293.46M | 179.63M | 74.25M |
| Total Liabilities | 694.33M | 559.23M | 551.02M | 419.52M | 301.96M |
| Stockholders Equity | 404.00M | 438.34M | 403.42M | 377.13M | 349.70M |
Cash Flow | |||||
| Free Cash Flow | -33.92M | -30.07M | -132.77M | 58.76M | 37.93M |
| Operating Cash Flow | 113.65M | 122.89M | 84.84M | 159.23M | 73.22M |
| Investing Cash Flow | -140.06M | -107.67M | -235.92M | -86.21M | 10.34M |
| Financing Cash Flow | -4.26M | 18.11M | 84.71M | -12.77M | -83.56M |
Covenant Logistics Group Technical Analysis
Positive
21.61
Price Trends
27.32
Positive
24.59
Positive
23.75
Positive
Market Momentum
-0.04
Negative
57.03
Neutral
78.05
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CVLG, the sentiment is Positive. The current price of 21.61 is below the 20-day moving average (MA) of 26.24, below the 50-day MA of 27.32, and below the 200-day MA of 23.75, indicating a bullish trend. The MACD of -0.04 indicates Negative momentum. The RSI at 57.03 is Neutral, neither overbought nor oversold. The STOCH value of 78.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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% | |
60 Neutral | $693.80M | 76.15 | 1.72% | 1.23% | 1.62% | -22.52% | |
57 Neutral | $576.54M | -4.00 | -6.38% | 2.76% | -7.55% | -130.67% | |
56 Neutral | $2.22B | ― | 4.61% | 0.62% | -5.34% | -48.16% | |
54 Neutral | $1.09B | 53.18 | 2.27% | 2.07% | -9.74% | -42.57% | |
49 Neutral | $1.78B | -126.32 | 1.78% | 1.84% | -3.42% | -43.86% | |
46 Neutral | $814.05M | -13.41 | -6.71% | 0.87% | -19.56% | -54.39% |
* Industrials Sector Average
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Covenant Logistics Group Corporate Events
Dividends
Covenant Logistics Declares Quarterly Dividend, Signals Ongoing Confidence
Positive
Feb 10, 2026
On February 5, 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. The dividend, made under an existing quarterly dividend program, will be paid o...
Other
Covenant Logistics CEO Plans Partial Stock Stake Sale
Neutral
Feb 9, 2026
Covenant Logistics Group, Inc. disclosed that Chairman and CEO David Parker and his wife Jacqueline Parker plan to dispose of approximately $15 million worth of the company’s Class A common stock at recent trading prices. The planned sale, r...
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.