GXO Logistics Is Off to the Races
It's barely been a week since GXO Logistics (NYSE: GXO) rang the bell at the New York Stock Exchange, marking its separation from XPO Logistics (NYSE: XPO). The decision is already looking like a smart move for the now-bifurcated transportation and logistics powerhouse.
Billed as a way of generating shareholder value, the move separated XPO's contract logistics business, now called GXO, from its transportation operations, which were primarily comprised of its less-than-truckload (LTL) and freight logistics segments. XPO CEO and GXO Chairman Brad Jacobs had long argued that XPO was trading at a "conglomerate discount," meaning its business was difficult to value because it had no publicly traded peers and had become too complex for investors to evaluate.
Splitting off GXO Logistics, which runs nearly 1,000 warehouses around the world for customers such as Apple, Nike, and Nestle helps solve that problem. Investors can compare GXO directly with competitors like Clipper and Kuehne + Nagel, while the current XPO business matches up directly with LTL providers like Old Dominion Freight Line and Saia.
Source Fool.com
