Why XPO's Results Could Signal a Split-Up Ahead
Logistics and transport giant XPO Logistics (NYSE: XPO) delivered second-quarter results at the end of July that exceeded expectations, but you would never know it from the stock's reaction.
Shares of XPO fell by more than 10% in the trading session following the earnings release as investors honed in on sluggishness in some key businesses. XPO also disappointed by comparison, with other high-profile transportation stocks delivering blockbuster results for the quarter.
I believe there is a good case to be made that Wall Street overreacted to the downside to XPO's results, but the stock's move if nothing else widens a valuation gap between XPO and other transports that has frustrated management for some time. Management was ready to act to address that gap prior to the COVID-19 pandemic, and as conditions normalize it is becoming more and more likely they will act again in the quarters to come.
Source Fool.com
