Why XPO is Exploring Strategic Alternatives

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XPO (XPO) - Get Report announced after the bell Wednesday that it was exploring the sale or spinoff of one or more of its business units.

The logistics giant said it doesn't intend to sell or spin off its North American less-than-truckload unit.

"We continue to trade at well below the sum of our parts and at a significant discount to our pure-play peers," said Bradley Jacobs, XPO chairman and CEO. "That's why we believe the best way to continue to maximize shareholder value is to explore our options, while remaining intensely committed to the satisfaction of our customers and employees."

During Mad Money, Jim Cramer sat down with Brad Jacobs, chairman and CEO of XPO Logistics Thursday night. The company announced it is exploring strategic alternatives.

Jacobs explained that despite being the seventh-best performing stock in the Fortune 500 over the past decade, the market still gives XPO a multiple of just eight to nine times earnings. He said each of their four business units would get a multiple much higher than that, which is why they're exploring options to spin off and sell each unit individually, reported TheStreet's Scott Rutt.

Jeff Marks, senior portfolio analyst with Jim Cramer's Action Alerts PLUS portfolio, weighed in on the company's announcement. 

Watch the full video above to see what he has to say. 

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