Expeditors International (NASDAQ:EXPD) is an uncommonly well-run company and that has led to some pretty healthy valuation multiples over the years. Now, though, investors are worried about what a new administration in Washington, D.C. could mean for international trade, not to mention concerns about shrinking margins in both the air and ocean freight businesses and ongoing investments intended to drive future market share growth.
Expeditors is more or less what seems to pass for cheap now; it's not all that cheap on an absolute basis, but it's at least reasonably priced. That said, there are meaningful uncertainties regarding the company's operating environment right now and this recent run of underperformance (six straight quarters below expectations on revenue, three on EPS) may continue a while longer. Along those lines, Expeditors' asset-light, conservative model does well in tougher times but improvements in underlying transportation/shipping markets could favor asset-heavier companies and less well-run operators that may see more margin leverage in any sort of upturn.
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Uncertain Times Will Test Expeditors International