RXO, Inc. (RXO) AI Stock Analysis

• Market Cap: $2.65B
• Dividend Yield: N/A
• Average Volume (3M): 1.84M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.50
• Revenue Growth: 46.41%
• EPS Growth: -1113.24%
• Country: US
• Employees: 7,540
• Sector: Industrials
• Sector Strength: 78
• Industry: Trucking
• EPS (TTM): 0.04
• Shares Outstanding: 163,987,240
• 10 Day Avg. Volume: 1,998,431
• 30 Day Avg. Volume: 1,835,099
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.25
• Enterprise Value/Revenue: 0.60
• Enterprise Value/Gross Profit: 3.85
• Enterprise Value/Ebitda: 85.79
• 1Y Price Target: $15.40
• Price Target Upside: -5.11% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 13

• Rating: 53 Neutral
• Price Target: $17.00 ▲(4.74% Upside)

RXO's overall score is driven by strong earnings call performance and positive short-term technical indicators. However, significant challenges in profitability, cash flow, and valuation weigh heavily on the score. The company's strategic improvements and technology integration offer potential upside, but financial and valuation concerns remain substantial.

Positive Factors

Earnings

RXO reported 2Q adj. EBITDA of $38MM beating our and Street estimate of $33MM.

Operational Improvements

RXO is checking the boxes on the integration and delivering incremental operating improvements.

Volume Growth

Less-than-truckload (LTL) volumes were up 45% year-over-year, representing a stable and profitable business.

Negative Factors

Margin Headwinds

RXO faces margin headwinds in the near term despite moving past its earnings trough.

Volume Base

It sees a sub-seasonal volume base given the recent weakness, yet remains comfortable with its expectation for full year volume growth in 2025.

Weak Truck Brokerage Volumes

Muted truck brokerage volumes were led by efforts to optimize price, volume, and service, as well as softness in auto markets.

RXO, Inc. Business Overview & Revenue Model

Company Description

RXO, Inc. (RXO) is a leading provider in the transportation and logistics sector, primarily focusing on freight brokerage services. The company leverages advanced technology and a vast network of carriers to deliver efficient and reliable transportation solutions. RXO specializes in connecting shippers with carriers to transport goods across various industries, ensuring timely and cost-effective delivery.

How the Company Makes Money

RXO, Inc. generates revenue primarily through its freight brokerage services. The company earns money by acting as an intermediary between shippers who need to transport goods and carriers who have the capacity to move those goods. RXO charges a fee for matching these parties and managing the logistics of transportation. This fee is typically a percentage of the total shipping cost. Additionally, RXO may have partnerships with large shippers or carriers, allowing them to negotiate favorable rates and increase their profit margins. The company also invests in technology to enhance operational efficiency, which can contribute to cost savings and increased revenue.

RXO, Inc. Financial Statement Overview

Summary

RXO faces significant financial challenges with declining revenues, negative profitability, and cash flow issues. The income statement shows a negative net profit margin and declining revenue. The balance sheet indicates moderate leverage but highlights profitability issues with negative return on equity. Cash flow metrics are weak, reflecting cash flow pressures and the need for better cash management.

Income Statement

RXO's income statement reveals significant challenges with profitability. The company has faced declining revenue with a recent TTM decline of 5.4% compared to the previous year. The net profit margin has turned negative in the TTM with -6.03%, indicating substantial net losses. While the gross profit margin remains relatively healthy at 15.8%, the negative EBIT margin of -1.28% signals operational difficulties. The EBITDA margin has slightly improved in the TTM at 0.72%, yet still shows weak profitability.

Balance Sheet

The balance sheet shows a mixed picture. RXO's debt-to-equity ratio in the TTM is 0.43, suggesting moderate leverage. However, the equity ratio at 48.0% suggests a fair proportion of equity financing. Return on equity is negative due to net losses, highlighting profitability issues. The company maintains a reasonable liquidity position with cash and equivalents, but declining equity and increasing liabilities pose risks.

Cash Flow

Cash flow analysis indicates significant challenges. The operating cash flow to net income ratio is negative due to both negative operating cash flow and net income, reflecting cash flow pressures. The free cash flow has deteriorated further in the TTM, highlighting capital expenditure and investment burdens. Overall, cash flow metrics underscore the need for better cash management and operational improvements.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.56B	4.55B	3.93B	4.80B	4.69B	3.36B
Gross Profit	859.00M	696.00M	658.00M	1.17B	1.01B	789.00M
EBITDA	38.57M	-187.00M	103.00M	209.00M	277.00M	160.00M
Net Income	-308.00M	-290.00M	4.00M	92.00M	150.00M	43.00M
Balance Sheet
Total Assets	3.20B	3.41B	1.82B	2.04B	2.07B	1.87B
Cash, Cash Equivalents and Short-Term Investments	18.00M	35.00M	5.00M	98.00M	29.00M	70.00M
Total Debt	679.00M	664.00M	558.00M	617.00M	135.00M	116.00M
Total Liabilities	1.61B	1.80B	1.23B	1.45B	998.00M	802.00M
Stockholders Equity	1.59B	1.61B	594.00M	589.00M	1.07B	1.07B
Cash Flow
Free Cash Flow	-37.01M	-57.00M	25.00M	253.00M	116.00M	-22.00M
Operating Cash Flow	-13.98M	-12.00M	89.00M	310.00M	155.00M	25.00M
Investing Cash Flow	-1.04B	-1.06B	-66.00M	-56.00M	-38.00M	-39.00M
Financing Cash Flow	1.09B	1.11B	-117.00M	-183.00M	-158.00M	32.00M

RXO, Inc. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.23
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RXO, the sentiment is Positive. The current price of 16.23 is above the 20-day moving average (MA) of 15.29, above the 50-day MA of 15.95, and below the 200-day MA of 19.63, indicating a neutral trend. The MACD of 0.02 indicates Negative momentum. The RSI at 54.67 is Neutral, neither overbought nor oversold. The STOCH value of 69.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RXO.

RXO, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNDR	72 Outperform	$4.37B	34.84	4.20%	1.52%	2.20%	7.86%
ARCB	68 Neutral	$1.69B	11.07	12.50%	0.65%	-6.42%	25.72%
WERN	65 Neutral	$1.73B	33.84	3.65%	1.95%	-6.43%	-13.76%
Sector *	64 Neutral	$10.95B	16.37	8.81%	1.96%	2.68%	-15.33%
MRTN	56 Neutral	$976.61M	46.69	2.72%	2.01%	-11.77%	-52.06%
RXO	53 Neutral	$2.65B	―	-27.96%	―	46.41%	-1113.24%
HTLD	49 Neutral	$664.94M	―	-4.42%	0.93%	-16.42%	-49.44%

RXO, Inc. Corporate Events

RXO Reports Q2 2025 Financial Results with Revenue Growth

On August 7, 2025, RXO reported its second-quarter financial results, highlighting a 1% increase in brokerage volume year-over-year, driven by a 45% growth in less-than-truckload volume. The company achieved a brokerage gross margin of 14.4%, with its Last Mile service experiencing a 17% year-over-year stop growth, marking the fourth consecutive quarter of double-digit growth. Despite a challenging freight market, RXO’s revenue rose to $1.4 billion from $930 million in the previous year, although it reported a GAAP net loss of $9 million, impacted by $10 million in transaction and restructuring costs. Adjusted net income improved to $7 million from $4 million in the previous year, and adjusted EBITDA increased to $38 million from $28 million.

RXO, Inc. Holds 2025 Annual Stockholders Meeting

RXO, Inc. held its 2025 Annual Meeting of Stockholders on May 21, 2025, where key decisions were made regarding the company’s governance and financial oversight. During the meeting, stockholders elected Class II and III directors for terms expiring in 2026, ratified Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, and approved an advisory resolution on executive compensation.