A Stephens Inc. analyst downgraded three trucking companies to "Equal-Weight" from "Overweight" Friday, citing deteriorating demand and weaker pricing.
Analyst Thom Albrecht cut his rating on less-than-truckload carriers YRC Worldwide Inc., Saia Inc. and Vitran Corp.
Albrecht predicts that poor pricing and slowing demand will overshadow company initiatives and Vitran and Duluth, Ga.-based Saia, while he raised concerns that a new integration effort at YRC will be slow to take hold.
Across the segment, Albrecht forecasts LTL carriers earnings could be flat or lower if demand remains "tepid."
The analyst noted that while the combination of Overland Park, Kansas-based YRC's Yellow and Roadway units might be a cost-saving and successful initiative when it is completed, the move might take a year to finish.
He also suggested that YRC might lose some business over that period amid possible service disruptions.
Less-than-truckload carriers fill their trucks with freight from a variety of sources and might re-sort and redistribute it at a company terminal along their route.
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