Fending off Amazon (AMZN) won't come without a hefty price tag if Home Depot (HD) decides to pull the trigger on one major acquisition. 

Speculation surfaced before the Christmas holiday that Home Depot has considered in recent months buying key logistics player XPO Logistics (XPO) . According to a Recode report, the interest reflects Home Depot's desire to keep Amazon from snatching up XPO first. Home Depot reportedly believes Amazon was also weighing an offer to buy XPO, which specializes in shipping and delivering big, bulky packages.

A Home Depot spokesman told TheStreet the company does not comment on acquisition rumors.

XPO's stock is up about 14% this month as investors position ahead of a potential deal in 2018. In a new note Tuesday, Morgan Stanley analyst Simeon Gutman said XPO could be worth in the range of $135 to $145 a share in a transaction. At the high end of the range, that would value XPO Logistics at $17.2 billion, or a 62% premium from current levels. 

So why should Home Depot consider breaking the bank on this deal?

Connecticut-based XPO Logistics calls itself a supply chain solutions firm, but when it comes to enormous shipments via Amazon, it's more than that. It's the last mile deliverer that picks up the slack when the likes of FedEx Corp. (FDX) and United Parcel Service Inc. (UPS) refuse to do so. That's a good place to be at the moment. 

At TheStreet's Financial Success Strategies conference in October, TheStreet founder Jim Cramer said XPO's CEO Bradley Jacobs is pretty much unbelievable. "What Brad Jacobs realizes is that Amazon is going to start having big ticket items, that they're gonna have to ship the 70-inch TV screen," Cramer said. "UPS and FedEx will not take this business. They will not carry the big stock for the last mile. They just won't do it."

Jacobs and XPO have "decided to take over this market," Cramer added. The company has 4,000 employees in its logistics department just trying to be sure that you get your package," Cramer noted.

XPO operates two business segments: transportation and logistics. Transportation provides freight brokerage, last mile, less-than-truckload, full truckload and global forwarding services. Logistics offers engineered and customized solutions, value-added warehousing and distribution, cold chain solution and other inventory services.

Growth in eCommerce has boosted XPO's workload, the company says. As a result of the increase in demand for online shopping packages, XPO this year hired 6,000 additional holiday workers to get through the seasonal rush. That's an enormous increase from the 1,000 additional workers XPO hired last holiday season.

XPO Logistics is a holding in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Jim Cramer buys or sells XPO? Learn more now.

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