Why Is Logistics Company ArcBest Stock Plunging Today?

ArcBest Corp (NASDAQ:ARCB) reported a second-quarter FY24 revenue of $1.08 billion, ahead of the consensus of $1.06 billion.

Sales by segments: Asset-Based $712.7 million (per-day decrease of 2.1%), and Asset-Light $395.8 million (per-day decrease of 4.2%).  

Asset-based business total tonnage per day decreased by 20.3%, and total shipments per day fell by 4.8% Y/Y.

Pricing momentum persisted this quarter due to a better freight mix, higher pricing on transactional shipments and contract renewal increases of 5.1%, with overall LTL industry pricing staying rational.

Meanwhile, Asset-Light revenues declined due to lower revenue per shipment and reduced margins from a soft rate environment and a higher share of lower-margin managed transportation business. Shipments per day grew by 12.6% Y/Y.

Adjusted EBITDA from continuing operations rose to $94.8 million from $76.30 million a year ago. Adjusted EPS was $1.98 compared to $1.54 a year ago, missing the consensus of $2.06.

ArcBest’s operating cash flow for the six months totaled $140.2 million, compared to $103.8 million a year ago. The company held cash and equivalents of $260.5 million as of June-end.

ArcBest declared a quarterly cash dividend of $0.12 per share, payable on August 27, 2024.

Judy R. McReynolds, ArcBest Chairman and CEO, said, “I am incredibly proud of our employees’ commitment to utilizing our quality process in pursuit of excellence every day. This dedication has led to significant improvements in our operational execution, with ABF Freight achieving its best on-time service performance in recent years.”

“Furthermore, our substantial year-over-year improvement in operating income is a solid performance, especially considering ongoing macroeconomic headwinds.”

Investors can gain exposure to the stock via Tidal ETF Trust Aztlan North America Nearshoring Stock Selection ETF (NYSE:NRSH) and SPDR S&P Transportation ETF (NYSE:XTN).

Price Action: ARCB shares traded lower by 10.9% at $108.37 at the last check Friday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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