Analyst Note| Matthew Young, CFA |
Wide-moat logistics specialist C.H. Robinson’s posted another quarter of strong gross-revenue growth (up 53%), which was above our forecast due to robust global forwarding growth and higher than expected TL volume gains. Easy comparisons are at play given pandemic headwinds a year ago, but freight demand is facing extraordinarily strong consumer goods spending and retailer restocking. On top of that, truckload-market capacity remains incredibly constrained, awarding truck brokers with relatively healthy pricing power as contracts are renegotiated. Truck brokerage (NAST) gross revenue grew 45% on strong truckload spot and contract pricing and load growth. TL volumes finally flipped positive (up 6% year over year) while LTL loads soared 24%. Global forwarding revenue doubled on surging sell-rates (tight air cargo capacity) and strong air and ocean volume gains.