Transportation a Growth Sector ?
As part of our recent Transportation and Logistics Report we conducted a Roundtable Forum with Helane Becker of Jesup & Lamont Securities , Robin Byde of HSBC Bank Plc , Kevin Kirkeby of Standard & Poor’s and David G. Ross of Stifel Nicolaus. Mr.Ross gave us his snapshot on the industry;
Mr. Ross: On the volume side,we hit the bottom for absolute freight volumes in the second quarter, and we should grow softly from that base. Over the next few quarters, we should see stimulus programs, like cash-for-clunkers program, boosting freight at least temporarily. Plus, we believe the inventory destocking that has occurred over the past year is nearing an end, and we should see at least inventory stabilization, if not a slight inventory build
Even though the path for an economic recovery will be mild for a protracted period, there will still be some volume growth from the rails and truckers. Select companies within the transportation sector will start to show earnings growth, probably driven more by changes in capacity than by any change in near-term demand.
This entry was posted on Wednesday, October 7th, 2009 at 10:32 pm and is filed under Industrial & Services Stocks. You can follow any responses to this entry through the RSS 2.0 feed.