Down More Than 30%: Goldman Sachs Says It's Time to Buy These 2 Beaten-Down Trucking Stocks

Yahoo

21 hours ago

In the ever-shifting landscape of the stock market, sometimes the smartest plays are found not in the sweeping trends but in overlooked corners. One such area now drawing renewed interest is the trucking sector.
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These companies form the backbone of domestic logistics, moving goods from ports to cities across the country – and that makes them particularly sensitive to tariff shifts and global trade tensions.
However, after months of steep declines, trucking names may be poised for a rebound, especially as trade talks between the U.S. and China begin to show signs of progress. That, at least, is the view of Goldman Sachs analyst Jordan Alliger.
'We are shifting our investment recommendations to favor the Trucking sector,' Alliger said. 'While fundamental risks remain, largely around tariffs and possible impacts to consumer demand and global freight flows, we find it best to try to increase exposure on the early side to names likely to benefit from the next EPS upgrade cycle.'
With that in mind, Alliger points to two trucking stocks that have dropped more than 30% this year, but despite the hit, he thinks they're far from out.
We've used the TipRanks database to find out what the rest of the Street has to say about his picks. Let's give them a closer look.
Saia, Inc. (SAIA)
The first stock we'll look at here is Saia, a Louisiana-based trucking company that's been in business for a century. Today, Saia is a leader in the vital less-than-truckload (LTL) segment of the shipping industry, and moves cargoes and shipments across the continental United States.
The company's covered delivery area includes more than 60,000 ZIP codes. Saia has 213 terminals in its network, and more than 15,000 employees who handle the company's 35,000-plus daily shipments. Through its extended range and partnership agreements, Saia's service also reaches to Alaska, Hawaii, and Puerto Rico, as well as Canada and Mexico.
As noted, Saia's core business is LTL freight in the lower 48 states. This is an essential segment of the US economy, allowing merchants and customers to send and receive small- to mid-sized cargoes on dependable delivery cycles. Shippers like Saia receive loads for transport, arrange for shipment when a truck's trailer is full, and coordinate the routes. Saia has proven adept at this complex business, and can offer a wide range of options to its customers: one-, two-, or three-day service; next-day delivery up to 600 miles and two-day delivery up to 1,200 miles; and consistent on-time deliveries. While Saia is best known as an LTL shipper, the company can also offer truckload shipping and pricing, for loads that take up at least 21 linear feet of trailer space or weigh in at more than 20,000 pounds.
Shares in Saia are down some 45% so far this year, reflecting the impact of the tariff and other economic uncertainties on the shipping industry, and on Saia's financial results in particular. In its 1Q25 results, released back in April, the company reported revenue growth – but missed expectations at both the top and bottom lines. Saia's first quarter revenue came in at $787.6 million, up 4.3% year-over-year and $23.95 million below the forecast, while the EPS of $1.86 was 90 cents per share lower than had been anticipated.
For Goldman's Alliger, the company's current situation represents a sound entry point for investors, based on Saia's combination of market share, expansion potential, and risk/reward. Alliger writes of the stock, 'As the company leverages regional cross sell-opportunities with existing (and new) customers, and perhaps can better penetrate national accounts with larger service area offering (through its recent network expansion), we think the company can continue to generate market share gains and broadly grow its tonnage at a faster rate than underlying industry trends (as SAIA did with the initial Northeast expansion in 2017). With LTL volume growth comes better capacity utilization, which in turn drives down cost per shipment (density benefit), enabling margins to accelerate meaningfully.'
Looking ahead, Alliger rates SAIA as a Buy, and his $410 price target implies a one-year upside potential of 63%. (To watch Alliger's track record, click here)
Saia's shares have a Moderate Buy consensus rating from the Street's analysts, based on 17 recent reviews that include 9 to Buy and 8 to Hold. The shares are priced at $251.43 and their average target price of $297.18 suggests that the stock will gain 18% in the next 12 months. (See SAIA stock forecast)
ArcBest Corporation (ARCB)
Next up is another leading North American trucking company, ArcBest. Founded in 1923 and based in Fort Smith, Arkansas, this company is known as an innovator in logistic solutions for customers across a wide range of industries. ArcBest's 14,000 employees work from 250 facilities, moving both full truckload and less-than-truckload freight orders. The company can provide specialty shipping, such as air-conditioned trailers, on demand, and boasts that its ground transport network connects with the global air and ocean carrying lines.
ArcBest has leveraged its century of experience to deliver industry-leading performance. The company caters to enterprise customers of all scales, understanding that businesses of all types have logistic needs. The company's ability to offer both full truckload services and LTL services gives it the flexibility needed to meet the demands of all of its customers. ArcBest does not describe itself as a trucking company, but as a logistics powerhouse.
Despite being a logistics powerhouse, ArcBest has faced demand headwinds in recent months that have adversely impacted the firm's financial results. The company's quarterly revenue in 1Q25 came to $967.1 million, slipping 6.7% year-over-year and missing the forecast by $19.06 million. At the bottom line, ArcBest reported an EPS of 13 cents, 28 cents per share less than expected. We should note here that shares in this trucking giant have fallen 31.5% so far this year.
Even though ArcBest's results disappointed in Q1, the stock still received an upbeat outlook from Goldman's Alliger. The analyst explains why he believes that the company will overcome the headwinds, saying in his outlook, 'While we think ARCB's OR trajectory has more structural headwinds to going significantly below the mid-to-high-80s level given its union employee and compensation/benefits structure, the company began 2025 with an OR of ~96% due in-part to normal seasonal deterioration into the 1Q vs 4Q (ARCB exited 2024 with OR at ~92%), meaning ARCB still has plenty of room to improve margins considerably over the near-to-medium term — particularly as the core volume (heavier weight vs transactional volumes) and business growth environment accelerates as this would also allow ARCB to capture outsized volume uplift not only from its traditional core LTL business, but also from its U-pack business…'
Alliger puts a Buy rating on ARCB stock. He complements that with a $101 price target, predicting a 12-month gain for the stock of 58.5%.
Overall, ArcBest has earned a Moderate Buy consensus rating from the Street, based on 11 recent reviews that break down to 5 Buys and Holds, each and 1 Sell. The stock is priced at $63.70, and its average target price of $81.90 points toward a 28.5% gain on the one-year horizon. (See ARCB stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
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