Expeditors International (NYSE:EXPD) shares plunged at the time of writing after the logistics solutions provider’s fourth-quarter results failed to surpass estimates. Revenue declined by 34% year-over-year to $2.3 billion, missing consensus by $20 million. In tandem, EPS of $1.09 lagged expectations by $0.12. This was a 21% year-over-year decline in the company’s bottom line.
The quarter was marked by lower airfreight tonnage and ocean container volume for Expeditors. Amid an uncertain macroeconomic environment, EXPD lowered its headcount in each quarter of 2023. While compensation remains one of the largest expenses for EXPD, the company is taking steps to lower costs and improve efficiency.
Additionally, the company faces multiple headwinds stemming from the rising conflicts in the Middle East and the addition of new capacity in the market. Jeffrey Musser, the company’s President and CEO, summed up the broader situation as, “If I had to use one keyword to describe the fourth quarter and all of 2023, it would be uncertainty.”
Is EXPD a Buy, Sell, or a Hold?
Despite these challenges, Expeditors’ share price is up by nearly 4% over the past year. Overall, the Street has a Moderate Sell consensus rating on Expeditors International, and the average EXPD price target of $115.83 implies the stock may be fairly priced at current levels.
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