Why Shares of XPO Logistics Are Up Today
Shares of XPO Logistics (NYSE: XPO) gained nearly 10% on Friday after the shipping and logistics company said it was a terminating its strategic review that could have seen it sell off multiple business units. It's hard to know if the market is really celebrating the decision, but investors are certainly applauding some clarity in a time of great uncertainty.
In January, XPO said it was exploring the sale of significant chunks of its business, complaining that the market was assigning a so-called "conglomerate discount" to its operations and arguing that each of the businesses would be valued higher if out on their own.
Shares of XPO have lost about half their value since that announcement. Unfortunately, valuations across the transport and shipping sectors have come down as well as the COVID-19 coronavirus pandemic has slowed economic activity and cut shipping volumes.
Source Fool.com
