Yellow | Which Truckers Are In for the Long Haul?

[Triplex]

Which Truckers Are In for the Long Haul? - Yahoo! Finance

Trucking has been called the "backbone of America." If this statement holds true, then the strain of a struggling U.S. economy is putting many industry players in danger of taking a trip to the emergency room. With weak demand resulting in sinking volumes, freight carriers have been struggling of late. In this article, we examine the three major obstacles trucking firms currently face: weak demand, excess capacity, and intense competition. Although we believe the slump will carry into the near term, we will highlight a few companies we think have the ability to deliver solid returns to investors over the long run.

 

[jdawgett]

This can't be good

(from the article)
Will an Industry Leader Bid Farewell?
One event that would considerably alleviate this issue would be for a major competitor to exit the market. Financially beleaguered YRC Worldwide (NasdaqGS:YRCW - News) best fits this bill. The company, which commands a leading 20% share of the less-than-truckload market, has struggled to integrate acquisitions amidst a sustained freight recession. Although YRC recently obtained an amendment to a critical covenant, the firm continues to carry a hefty debt load and may have trouble covering interest and pension expenses if it is unable to cut costs fast enough. We consider a bankruptcy scenario as more possible than probable, but such an event would significantly remedy industry overcapacity. Even then, though, it's unlikely the assets would leave the industry under most scenarios.

 

[Jay C]

Short These Truckers! -- Seeking Alpha __________

Con-Way is 32 today, up from its March 9 low of 13.20. That’s up 242% in 3 months.

I say it’s also ripe for a fall.

I’ve looked at TruckingBoards.com (yes, there really is such a website) to see if there is any chatter among the drivers as to why either of these should be up like this. Nada. Zilch. Bupkus.

We’re short both stocks. We initiated the trades on 15 June 2009, shorting SAIA at E-Trade and CNW at TD Ameritrade.

Traders pushed Con-way stock way up thinkin YRC will go down.. but now they are betting Conways stock takes a big hit and they learned it from none other then TruckingBoards

 

[annieo]

Buy low, sell high. Hope that helps them.