RXO Inc. (RXO)RXO

RXO Inc. : Comprehensive Overview

Company Profile

History: Established in 1985. Initially named Roadrunner Transportation Systems Inc. and changed to RXO Inc. after acquiring Total Quality Logistics (TQL).

Business Areas: RXO Inc. is a leading provider of transportation & logistics services, operating through two segments;

1. Truck Brokerage (TQL) : Facilitates freight movement by connecting shippers with trucking carriers.
2. Dedicated Contract Carriage (DCC & TL) : Manages private fleets for customers, provides dedicated trucks & drivers for long-term contracts.

Leadership:

• CEO & Chairman: Dale W. Williams
• President : Mark Shaheen
• Other Key Executives: Adam Sweet , Patrick Duffy and Jennifer Volkman.
  ** Top Products & Market Share **

**Products: **

1. Truckload Services
2. Less-than-Truckload Services (LTL)
3. Intermodal Transportation
4. Dedicated Transportation & Warehousing

Market Share & Competition:

• TQL: Market leader in North American truck brokerage with 17.5% (est.), followed by C.R England Inc (9%) and Landstar System Inc (8-9%).

Financial
Performance :

Revenue growth : 21.72% in 2022

Net income : 537 M in 2022 **Operating margin: ** 9.63% in 2022 EPS (TTM) : 9.03

Financial health is strong : with ample cash flows, low debt, and positive shareholder equity growth in 2022.

**Dividends & Shareholder Returns **

History of consistent Dividend Growth : Annual increases since TQL became RXO Inc., in 2023 dividend amounted 2.70 $ per share with annualized yield of ~1.38%. Share capital appreciation: ~80% since the company went Public.

 **Growth  Trajectory & Market Dynamics: **    

• Transportation market expected 3.7% annual CAGR until 2027.
• T.R.U.C.K. Act may create uncertainties but positive effects in long haul, where RXO lacks significant activity.
• Rising fuel expenses affecting margins, compensations through fuel surcharges.

**Competition:

** Major competitor in Truck Brokerage are :

• C H Robinson Worldwide ( CHRW )

• J. B. Hunt Transport Services Inc (JBHT)

• **Potential Challenges & Opportunities : ** **

• Supply Chain disorganization creating operational bottlenecks, TQL could benefit in market share.

• Fuel Prices Volatility : Risk management required, fuel surcharged might impact customers long term .

  Recent Acquisitions (2023 ): * None, focusing on organic development.

  **AI- based Fundamental Rating :

• 8-9/10

• Justificatio** : Strong financials, leading market position and growth opportunities, AI predicts upside potential with some uncertainties

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**Disclaimer & Sources : ***

• Data collected as of August 2011th, 22 from :

• Annual and Quarterly reports of RXO Inc.

• Statista

• Investor presentations of RXO

This information is presented for information purpose only and not an investment or trading advise.