XPO Logistics Is Now Citi's Top Pick In Trucking

Shares of XPO Logistics Inc (NYSE: XPO) are not only higher by nearly 40 percent since the start of 2017 and hit a new all-time of $60.57 on Monday. Yet, some among the Street expect further upside.

Citi's Christian Wetherbee named the Fortune 500 company as the firm's top pick within the trucking sector, partly due to overall favorable trends across the entire trucking sector. Specifically, truckload demand has accelerated after the first quarter's "soft patch" while less than truckload is "up nicely" in the second quarter (check out Christian Wetherbee's track record).

Looking forward, there is a better case to be made for preferring LTL focused trucking companies over TL due to better cyclical exposures, e-commerce shifts, and pricing trends, the analyst added. As such, XPO is a favorable investment since it is best-positioned to take advantage from these dynamics.

As such, the analyst sees upside in XPO's stock to $75 per share. Investors looking for exposure to more TL-focused trucking companies should consider an investment Schneider National Inc (NYSE: SNDR) as the analyst sees upside to $25 per share.

XPO and Schneider are justified in boasting superior multiples given the companies superior earnings growth profile, the analyst also suggested.

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