Please ensure Javascript is enabled for purposes of website accessibility

Why Shares of Echo Global Logistics, Inc. Popped Today

By Travis Hoium - Oct 29, 2015 at 12:54PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Strong shipping is sending this logistics stock higher.

What: Shares of supply chain management company Echo Global Logistics, Inc. (ECHO) jumped 38% today after it reported earnings.

So what: Third-quarter revenue jumped 40% to $450 million and net revenue was up 50% to $87 million. Non-GAAP net income rose 41% to $10.2 million, or $0.34 per share, which was $0.02 ahead of estimates.  

Now what: Revenue continues to be strong since Echo's acquisition of Command Transportation. But investors had become concerned that the growth wouldn't translate to similar growth on the bottom line. However, stronger-than-expected earnings despite headwinds like low oil prices give investors confidence that future growth should be strong as well.

The pop today seems to be overdone, but if shares settle lower in coming weeks, this is a stock that provides nice long-term growth potential for investors.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Echo Global Logistics, Inc. Stock Quote
Echo Global Logistics, Inc.

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.