Sector Snap: Analyst Starts Ratings For Truckers

NEW YORK (AP) — An analyst initiated coverage of several so-called "truckload carriers" on Tuesday, saying the companies with the fewest trucks are poised to perform the best in shaky economy.

Truckload carriers take freight directly from one shipper to a receiver, as opposed to less-than-truckload carriers that take freight from a variety of sources, sort and redistribute it at terminals along their route.

RBC Capital Markets analyst John Barnes put an "Outperform" rating on J.B. Hunt Transport Services Inc. and Landstar Systems Inc. At J.B. Hunt, Barnes said the company's wide range of business segments allows it to be less vulnerable in the current economic doldrums because weakness in one division can be offset by strength in others.

At Landstar, he thinks that while the stock could waver in coming months, Barnes believes that the stock is still a good pick for investors in the long-term. Strong future earnings and cash flow should boost the stock, he said.

Barnes gave Heartland Express Inc. and Werner Enterprises Inc. "Underperform" ratings. The analyst said both companies need to produce better earnings to warrant attention of investors.

He gave Knight Transportation Inc. and Ryder System Inc. "Sector Perform" ratings, saying the stocks don't appear likely to grow anytime soon given the high probability of a slow economic recovery.

Truckload stocks gained with the broader market in midday trading, except for Ryder System, which lost 11 cents to hit $37.69.