Why Old Dominion Freight Line Stock Crashed on Wednesday
Shares of less-than-truckload shipper Old Dominion Freight Line (NASDAQ: ODFL) fell 10.2% through 1:15 p.m. ET today despite largely meeting market expectations for its first-quarter earnings this morning.
Heading into the quarter, analysts had forecast Old Dominion would earn $1.34 per share on sales of $1.47 billion. As it turned out, earnings were $1.34, and revenue only just missed expectations at $1.46 billion. So are investors overreacting here?
Not necessarily. Expectations for Old Dominion have been running pretty hot, with most analysts agreeing the company will grow earnings at about 23% annually over the next five years. It's this expectation that the stodgy shipping stock will turn out to actually be a growth stock that explains why it has been outperforming the S 500 lately, lifting its stock price to nearly 40 times earnings today, up 44% over the last 52 weeks.
Source Fool.com
