Oppenheimer: XPO Logistics 'Acquisition Wheels Still Rolling'

In a report published Tuesday, Oppenheimer analyst Scott Schneeberger commented on XPO Logistics Inc XPO's "solid" quarter despite West Coast port-driven headwinds in the "seasonally-light" first quarter. Schneeberger noted that the company delivered organic growth that remained in the double digits, Transportation net revenue margin expanded 90 basis points year-over-year and adjusted earnings per share of $(0.13) was higher than the $(0.25) the Street was expecting. In addition, the company announced the acquisition of privately-held Bridge Terminal Transport Services (BTT), one of the largest U.S. asset-light drayage providers. The acquisition, according to Schneeberger, will "significantly' expand XPO's drayage capacity on the East Coast, while adding multinational customer relationships and synergies. Schneeberger added that XPO's updated 2015 annualized revenue and EBITDA run-rate guidance exiting 2015 to $9.5 billion and $625 million from $5.25 billion and $300 million, respectively, doesn't include acquisition revenue incremental the $5.84 billion already acquired year-to-date. The analyst further added he believes XPO's acquisition story is "unlikely" to be done for the year. Looking forward, Schneeberger is expecting the company to issue an update to its 2017 guidance of $9 billion in revenue and $575 million EBITDA outlook following the closure of the Norbert Dentressangle acquisition and a possible refinancing in the coming months. These events, the analyst argued, present "major catalysts" in the company's "rapidly evolving story." Shares remain Outperform rated with an unchanged $52 price target.