Oppenheimer Initiates Coverage of Landstar with Outperform Rating, $66 PT

In a report published earlier today, Oppenheimer Holdings initiated coverage of Landstar System, Inc.

with an Outperform rating and a $66.00 price target. Oppenheimer went on to say “We are initiating coverage of Landstar System (LSTR) with an Outperform rating/$66 price target. An asset-light, high ROIC third-party logistics (3PL) provider, LSTR is the 2nd largest competitor in the U.S. truck brokerage market, which possesses an attractive secular growth story of customers increasingly outsourcing their logistics to enhance operational efficiency and reduce expense. With its sizeable mix of industrial/energy-based customers experiencing increased business activity, as evidenced by LSTR's +15% y/y 1Q12 flatbed (higher rate trailers for moving industrial equipment; >1/3rd of LSTR's revenue) volume growth, we anticipate LTSR growing revenue/gross profit/EBITDA/EPS double digits in 2012. Our $66 price target is based on 13x/11.5x 2012E/2013E EV/EBITDA vs. 7.3x-14.4x FTM EBITDA historically.” Landstar System, Inc. closed yesterday at $54.45