Morningstar Rating

Stock Research and Analysis

by Matthew Young, CFA

Bulls Say

Echo's upcoming acquistion of Command Transporation offers plentiful opportunities for cross-selling its LTL-brokerage and managed-transportation services to Commands customer base.
Constrained truckload capacity will support favorable pricing conditions for top-shelf domestic highway brokers in the year ahead.
Echo is grabbing market share from asset-based truckers (in terms of processing the load), partly because it can aggregate supply in the fragmented truckload market. By outsourcing to Echo, shippers avoid the burden of managing carrier relationships on their own. Read more 

Bears Say

As a relatively new company (2005), Echo has a limited history. While it has posted solid top-line expansion and decent margin gains since inception, its ability to create shareholder wealth over the long run is unproved.
High returns on capital are attracting competition to the 3PL space, including startups and brokerage operations of asset-based truckers. Tight truckload supply is making the brokerage space even more enticing.
Small brokerage firms once limited in scope are becoming more efficient (and more of a competitive threat) as they are acquired by larger, more capable 3PLs. Read more 

Management

Chief executive Douglas Waggoner has been at the helm since late 2006. Before that, founders Eric Lefkofsky and Bradley Keywell shared responsibility for overseeing Echo's day-to-day operations during the company's startup phase. We think members of   Read more 

Profile

Founded in 2005, Echo Global Logistics is an asset-light third-party logistics provider specializing in domestic truckload and less-than-truckload brokerage. It also offers   Read more 

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