Morningstar Rating

Stock Research and Analysis

by Matthew Young, CFA

Bulls Say

Landstar's asset-light model generated average returns on capital of 29% over the past decade--well above returns generated by most traditional asset-intensive carriers.
We expect the truck brokerage industry to expand at a faster pace than the underlying transportation market, driven by share gains from asset-based providers and incremental logistics outsourcing.
Landstar's vast network of shippers and carriers crafts a robust value proposition. The firm aggregates its buying power to reduce shippers' transportation costs while providing carriers with an attractive source of cargo. Read more 

Bears Say

Rising capacity rates related to tight truckload capacity will probably temper gross-profit margins on brokerage business during the first half of 2014.
High returns on capital are attracting competition to the 3PL industry, including startups and truck brokerage operations of traditional asset-based truckers.
Rising regulation and the related potential for driver shortages across the trucking industry could ultimately constrain Landstar's ability to recruit qualified owner-operators. Read more 

Management

In our view, Landstar possesses a solid management team. CEO Henry Gerkens has been at the helm since 2004, and has held a number of roles (including COO) during his 20-year-plus tenure at the firm. Jim Gattoni has been CFO since early 2007. Senior   Read more 

Profile

Landstar System is an asset-light, third-party logistics provider focused on over-the-road truck transportation (94% of revenue). It also offers intermodal (3%) as well   Read more 

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