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Knight Transportation (KNX)
NYSE:KNX
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Knight Transportation
(NYSE:KNX)62Neutral
Positive Factors
Contract rates
Even modest optimism from management could drive big beats, which may be further supported by contract rates already on an upward trend.
Earnings momentum
TL contractual rate commentary was incrementally positive and when paired with fixed cost initiatives, positions KNX for earnings momentum.
Negative Factors
Freight market inflection
The delayed time frame for a freight market inflection likely continues to weigh on 2025 EPS.
Network expansion costs
Network expansion is weighing on margins given operational inefficiencies, start-up costs, and lower 3PL yields.
Knight Transportation (KNX) vs. S&P 500 (SPY)
Market Cap
$7.76B
Dividend Yield1.3%
Average Volume (3M)2.88M
Price to Earnings (P/E)66.0
Beta (1Y)1.10
Revenue Growth3.76%
EPS Growth-46.10%
CountryUS
Employees34,800
SectorIndustrials
Sector Strength66
IndustryTransportation
Share Statistics
EPS (TTM)0.72
Shares Outstanding161,975,630
10 Day Avg. Volume3,853,930
30 Day Avg. Volume2,876,342
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.07
Price to Cash Flow (P/CF)7.30
P/FCF Ratio7.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$62.38Price Target Upside30.28% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
Knight Transportation Business Overview & Revenue Model
Company DescriptionKnight Transportation, a subsidiary of Knight-Swift Transportation Holdings Inc., is a leading provider of truckload transportation services in North America. It operates within the transportation and logistics sector, offering a range of services including dry van, refrigerated, and dedicated trucking solutions. With a focus on safety, efficiency, and customer satisfaction, Knight Transportation serves a diverse clientele across various industries.
How the Company Makes MoneyKnight Transportation generates revenue primarily through its truckload transportation services, which include dry van, refrigerated, and dedicated trucking. The company earns money by charging clients for transporting goods over long distances using its fleet of trucks. Revenue streams are bolstered by the company's operational efficiency and ability to manage logistics effectively. Additionally, Knight Transportation benefits from strategic partnerships and contracts with major shippers, ensuring a steady flow of business. Other contributing factors to its earnings include fuel surcharge programs and ancillary services such as logistics and brokerage solutions.
Knight Transportation Financial Statement Overview
Summary
Knight Transportation's financial health is stable with a strong equity base and manageable debt. However, challenges include a decrease in profitability and lack of cash flow data for 2024, indicating potential liquidity issues.Income Statement
Knight Transportation's income statement reveals a stable revenue trend with a slight growth rate over the years. The latest Gross Profit Margin stands at 34.35%, a strong indicator of cost management efficiency. However, the Net Profit Margin dropped to 1.59% in 2024 from 3.04% in 2023, suggesting challenges in converting revenue to net income due to increased expenses or reduced efficiencies. The EBIT and EBITDA margins are reasonable, at 3.28% and 9.41% respectively, although a decline in EBIT Margin from the previous year indicates some operational inefficiencies.75
Positive
Balance Sheet
The balance sheet shows a robust equity base, with a Debt-to-Equity Ratio of 0.19, signaling a conservative leverage approach. The Equity Ratio of 55.98% reflects a strong reliance on equity financing, providing financial stability. ROE has decreased to 1.65% from 3.06% in 2023, pointing to lower profitability from the shareholders' perspective. Overall, the balance sheet is stable with minimal risk from debt obligations.80
Positive
Cash Flow
Cash flow analysis shows volatility with zero reported figures for 2024, raising concerns about operational cash generation and capital expenditure. In previous years, the Free Cash Flow showed fluctuations, with a significant drop in 2024 compared to past performance. The Operating Cash Flow to Net Income ratio was favorable in past years, indicating efficient cash conversion, but the absence of recent data suggests potential liquidity management issues.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 7.41B | 7.14B | 7.43B | 6.00B | 4.67B | Gross Profit |
| 1.03B | 1.25B | 1.77B | 1.41B | 969.12M | EBIT |
| 243.39M | 338.15M | 412.30M | 418.18M | 76.28M | EBITDA |
| 1.11B | 1.13B | 1.77B | 1.62B | 1.17B | Net Income Common Stockholders |
| 117.63M | 217.15M | 771.33M | 743.39M | 410.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 218.26M | 168.54M | 196.77M | 261.00M | 156.70M | Total Assets |
| 12.70B | 12.87B | 10.95B | 10.66B | 8.47B | Total Debt |
| 1.37B | 3.20B | 2.09B | 2.24B | 817.08M | Net Debt |
| 1.01B | 3.03B | 1.89B | 1.98B | 660.38M | Total Liabilities |
| 5.58B | 5.77B | 4.00B | 4.11B | 2.60B | Stockholders Equity |
| 7.11B | 7.09B | 6.95B | 6.53B | 5.87B |
| Cash Flow | Free Cash Flow | |||
| -20.09M | 90.06M | 635.29M | 656.06M | 398.58M | Operating Cash Flow |
| 799.06M | 1.16B | 1.44B | 1.19B | 919.64M | Investing Cash Flow |
| -759.12M | -1.23B | -646.18M | -1.82B | -480.71M | Financing Cash Flow |
| -139.40M | 150.69M | -754.35M | 779.33M | -443.88M |
Knight Transportation Technical Analysis
Negative
47.88
Price Trends
53.98
Negative
54.42
Negative
52.37
Negative
Market Momentum
-1.74
Positive
28.76
Positive
14.68
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KNX, the sentiment is Negative. The current price of 47.88 is below the 20-day moving average (MA) of 52.67, below the 50-day MA of 53.98, and below the 200-day MA of 52.37, indicating a bearish trend. The MACD of -1.74 indicates Positive momentum. The RSI at 28.76 is Positive, neither overbought nor oversold. The STOCH value of 14.68 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KNX.
Knight Transportation Risk Analysis
Knight Transportation disclosed 39 risk factors in its most recent earnings report. Knight Transportation reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Knight Transportation Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | $37.19B | 31.94 | 27.94% | 0.60% | -0.88% | -2.79% | |
67 Neutral | $5.46B | 28.02 | 20.15% | 0.91% | -9.13% | -25.11% | |
67 Neutral | $10.58B | 29.39 | 15.67% | ― | 11.37% | 1.82% | |
65 Neutral | $15.76B | 28.37 | 14.22% | 1.10% | -5.79% | -20.32% | |
63 Neutral | $11.67B | 25.49 | 27.04% | 2.45% | 0.73% | 41.65% | |
62 Neutral | $7.76B | 66.01 | 1.65% | 1.30% | 3.76% | -46.10% | |
62 Neutral | $8.11B | 13.34 | 1.17% | 3.02% | 4.16% | -15.14% |
* Industrials Sector Average
Performance Comparison
KNX
Knight Transportation
47.88
-6.99
-12.74%
CHRW
CH Robinson
98.35
30.01
43.91%
JBHT
JB Hunt
157.62
-40.48
-20.43%
LSTR
Landstar System
154.52
-26.94
-14.85%
ODFL
Old Dominion Freight
175.00
-39.17
-18.29%
SAIA
Saia
397.14
-207.63
-34.33%
Knight Transportation Earnings Call Summary
Earnings Call Date: Jan 22, 2025 | % Change Since: -12.95% | Next Earnings Date: Apr 17, 2025
Earnings Call Sentiment Neutral
The call highlighted significant improvements in adjusted operating income and substantial growth in the LTL and Logistics segments. However, challenges remain with declining Truckload revenue and LTL operating income due to integration costs. The overall sentiment is cautiously optimistic with strategic plans for growth and efficiency gains in 2025.Highlights
Improved Adjusted Operating Income
Adjusted operating income improved by 127% or $59.4 million year-over-year.
LTL Revenue Growth
The LTL business grew revenue, excluding fuel surcharge, by 20.2% year-over-year.
Logistics Revenue Increase
Logistics revenue increased by 17% sequentially, with adjusted operating income up 34.6%.
Intermodal Load Growth
Intermodal load count increased by 10.2% year-over-year, leading to a 4.9% revenue increase.
Lowlights
Truckload Revenue Decline
Truckload revenue, excluding fuel surcharge, decreased by 4.4% year-over-year.
LTL Operating Income Decline
Adjusted operating income for LTL declined 54.9% year-over-year due to start-up costs and integration expenses.
All Other Segments Revenue Decline
Revenue in All Other Segments declined 36.4% year-over-year, primarily due to winding down the third-party insurance business.
Company Guidance
During Knight-Swift Transportation's Q4 2024 earnings call, the company provided detailed guidance for 2025, emphasizing a strategic focus on leveraging scale and improving margins across various segments. For 2025, the company projected an adjusted EPS range of $0.29 to $0.33 for Q1 and $0.46 to $0.50 for Q2, underpinned by expectations of gradual market recovery and normal seasonal trends. The Truckload segment is set to benefit from anticipated contractual rate improvements and cost-cutting initiatives, while the LTL segment aims to enhance margins through shipment growth and network efficiency. The company also highlighted plans for growth in its Logistics segment, leveraging technology to improve transactional efficiency, and targeted market share gains in Intermodal through strategic customer diversification and cost management. Overall, Knight-Swift's guidance reflects a cautious optimism for improved market conditions and operational efficiencies in 2025.Knight Transportation Corporate Events
Executive/Board ChangesDividendsBusiness Operations and Strategy
Knight Transportation Announces Executive Incentive Plan and Dividend
Positive
Nov 12, 2024
Knight-Swift Transportation Holdings Inc. has rolled out a new equity award plan for its executives, blending performance-based stock units (PRSUs) and restricted stock units (RSUs) under its incentive plan. The PRSUs are tied to several performance targets, potentially offering a payout range from 0% to 200% based on target achievement, while RSUs vest over a three-year period. This strategy aims to align top management’s incentives with the company’s long-term growth ambitions. Additionally, a quarterly cash dividend of $0.16 per share has been declared, payable in December 2024.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.