The Air and Ocean Unwind Drags on for Expeditors but Outlook Mostly Stable

Expeditors International ranks among the top 10 global freight forwarders in a highly fragmented industry, and its record of impressive financial performance leads the industry. The firm operates more than 250 offices on six continents, with a core focus on Asia-North America trade lanes, though it's also been gradually expanding its presence on key intra-China and European freight lanes over the past decade. As a global forwarder, the company contracts with airlines and ocean carriers for cargo space then fills that capacity with customers' freight. A large customs brokerage operation (including warehousing and distribution services) complements air and ocean services, along with multimodal and final-mile delivery services in North America (Transcon). Expeditors' asset-light model generates excellent returns on capital in excess of 40% over the past decade, with help from its wide economic moat, which is rooted in the network effect.