Looking for Upturn at End of Slide
Trucking stocks continued their slide from 1999 through the first half of 2000, but industry executives and market analysts suggested that in the coming months companies might find a floor on which to land and may even begin to rebound.
At the time of the announcements, Covenant, a truckload hauler out of Chattanooga, Tenn., was trading at a one-year low of $8.25 a share, and USF, a nationwide operator of regional LTL carriers, was trading at $25.94 a share, its lowest level for 2000.
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The success of large survivors, though, may come at the expense of small fleets and owner-operators. To the extent the “little guys” of trucking perish, the publicly-traded giants will reap the benefits of a capacity crunch in both the truckload and less-than-truckload sectors, according to several analyses.
Two examples of industry optimism on the part of large companies were reported one week ago. USFreightways Corp. and Covenant Transport were both trading at relative low points, yet both carriers announced plans to buy back their shares.
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