Industry Observations March 31, Transportation & Logistics Industry

Transcription

1 Industry Observations March 31, 2017 Transportation & Logistics Industry

2 Select Transportation & Logistics Public Company Industry Data (USD in millions, except per share data) Company Name Ticker Price at 03/31/17 % of 52 Week High Market Data LTM Operating Data Forward Estimates Equity Value Enterprise Value Debt / Total Capital Total Assets LTM Revenue LTM CY 2017 Revenue Estimate CY 2017 Estimate Transportation - Less Than Truckload ArcBest Corporation ARCB $ % $ $ % $ 1,310.0 $ 2,700.2 $ $2, $ Old Dominion Freight Line Inc. ODFL $ % $ 7,057.0 $ 7, % $ 2,696.2 $ 2,991.5 $ $3, $ Saia, Inc. SAIA $ % $ 1,116.9 $ 1, % $ $ 1,218.5 $ $1, $ YRC Worldwide Inc. YRCW $ % $ $ 1, % $ 1,770.0 $ 4,697.5 $ $4, $ Transportation - Long-Haul / Truckload Covenant Transportation Group, Inc. CVTI $ % $ $ % $ $ $ $ $ JB Hunt Transport Services Inc. JBHT $ % $ 10,211.7 $ 11, % $ 3,829.0 $ 6,555.5 $ 1,082.5 $7, $1, Knight Transportation KNX $ % $ 2,518.1 $ 2, % $ 1,078.5 $ 1,118.0 $ $1, $ Inc. Swift Transportation SWFT $ % $ 2,733.1 $ 3, % $ 2,745.7 $ 4,031.5 $ $4, $ Company Werner Enterprises Inc. WERN $ % $ 1,891.4 $ 2, % $ 1,793.0 $ 2,009.0 $ $2, $ Transportation - Other FedEx Corporation FDX $ % $ 52,178.2 $ 63, % $46,781.0 $57,570.0 $ 7,805.0 $61, $8, United Parcel Service, Inc. UPS $ % $ 93,275.9 $104, % $40,377.0 $60,906.0 $ 7,699.0 $64, $10, Logistics - Asset Light Transportation CH Robinson Worldwide Inc. CHRW $ % $ 10,925.7 $ 11, % $ 3,687.8 $13,144.4 $ $14, $ Expeditors International EXPD $ % $ 10,207.5 $ 9, % $ 2,790.9 $ 6,098.0 $ $6, $ of Washington Inc. Hub Group Inc. HUBG $ % $ 1,584.2 $ 1, % $ 1,360.3 $ 3,572.8 $ $3, $ XPO Logistics, Inc. XPO $ % $ 5,337.7 $ 10, % $11,698.4 $14,619.4 $ 1,131.5 $14, $1, Notes: LTM (latest twelve months); Enterprise Value (market capitalization less total cash and short-term investments plus short-term borrowings and total long-term debt); (earnings before interest, taxes, depreciation and amortization) Source: Capital IQ The material contained in this publication is meant to provide general information regarding valuation topics. This publication does not constitute investment advice with respect to the securities of any company discussed herein, is not intended to provide information upon which to base an investment decision, and should not be construed as such. Professional advice should be obtained before taking any action based on the information contained herein. Publicly available information utilized in this publication has been obtained from sources deemed to be reliable. Houlihan does not guarantee the accuracy or completeness of the information provided within this publication. The material presented reflects information known to the authors at the time this publication was written and this information is subject to change. Houlihan Capital 2

3 Select Transportation & Logistics Public Company Valuation Metrics (USD in millions, except per share data) Company Name Ticker Return On Assets Return On Equity LTM Operating Statistics Return On Revenue Capital Growth Growth Margin TEV/ LTM Revenue Trading Multiples TEV/ TEV/ CY 2017 LTM Revenue TEV/ CY 2017 Transportation - Less Than Truckload ArcBest Corporation ARCB 1.8% 3.1% 2.9% 1.2% -17.6% 5.1% 0.3x 0.3x 5.4x 4.4x Old Dominion Freight ODFL 11.7% 16.7% 16.0% 0.6% 1.5% 22.5% 2.4x 2.2x 10.6x 9.7x Line Inc. Saia, Inc. SAIA 6.5% 10.5% 9.4% -0.2% 0.2% 12.8% 1.0x 0.9x 7.7x 7.0x YRC Worldwide Inc. YRCW 3.8% N/A 10.8% -2.8% 3.8% 5.7% 0.3x 0.3x 4.6x 4.0x Mean 5.9% 10.1% 9.8% -0.3% -3.0% 11.5% 1.0x 0.9x 7.1x 6.3x Median 5.1% 10.5% 10.1% 0.2% 0.9% 9.2% 0.6x 0.6x 6.5x 5.7x Transportation - Long-Haul / Truckload Covenant CVTI 3.2% 7.7% 4.5% -7.4% -19.8% 15.5% 0.8x 0.8x 5.3x 4.9x Transportation Group, JB Hunt Transport JBHT 12.1% 31.8% 19.2% 5.9% 2.6% 16.5% 1.7x 1.6x 10.3x 10.3x Services Inc. Knight Transportation KNX 8.1% 12.5% 10.8% -5.5% -7.8% 23.2% 2.3x 2.2x 9.8x 9.9x Inc. Swift Transportation SWFT 5.6% 23.2% 8.3% -4.7% -12.1% 13.3% 0.9x 0.9x 7.0x 7.2x Company Werner Enterprises Inc. WERN 4.1% 8.2% 6.3% -4.0% -14.7% 15.9% 1.0x 1.0x 6.4x 5.8x Mean 6.6% 16.7% 9.8% -3.1% -10.3% 16.9% 1.4x 1.3x 7.8x 7.6x Median 5.6% 12.5% 8.3% -4.7% -12.1% 15.9% 1.0x 1.0x 7.0x 7.2x Transportation - Other FedEx Corporation FDX 7.2% 12.9% 11.6% 16.3% 5.2% 13.6% 1.1x 1.0x 8.2x 7.2x United Parcel Service, Inc. UPS 8.7% 235.0% 20.5% 4.4% -21.0% 12.6% 1.7x 1.6x 13.6x 9.8x Mean 8.0% 124.0% 16.0% 10.3% -7.9% 13.1% 1.4x 1.3x 10.9x 8.5x Median 8.0% 124.0% 16.0% 10.3% -7.9% 13.1% 1.4x 1.3x 10.9x 8.5x Logistics - Asset Light Transportation CH Robinson CHRW 15.2% 42.6% 22.8% -2.5% -1.6% 6.9% 0.9x 0.8x 13.2x 12.8x Worldwide Inc. Expeditors International EXPD 15.6% 24.4% 23.7% -7.8% -6.6% 11.8% 1.5x 1.4x 12.9x 12.3x of Washington Inc. Hub Group Inc. HUBG 5.8% 11.7% 9.7% 1.3% 9.4% 4.7% 0.5x 0.4x 9.7x 11.0x XPO Logistics, Inc. XPO 2.5% 2.8% 3.7% 91.8% 236.5% 7.7% 0.7x 0.7x 9.0x 7.6x Mean 9.8% 20.4% 15.0% 20.7% 59.4% 7.8% 0.9x 0.8x 11.2x 10.9x Median 10.5% 18.1% 16.2% -0.6% 3.9% 7.3% 0.8x 0.8x 11.3x 11.7x Notes: LTM (latest twelve months); NTM (next twelve months); (earnings before interest, taxes, depreciation and amortization); TEV (total enterprise value) Source: Capital IQ Houlihan Capital 3

4 Transportation & Logistics Public Company LTM Equity Performance 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% % % % Transportation - Less Than Truckload Transportation - Other Dow Jones Industrial Average Transportation - Long-Haul / Truckload Logistics - Asset Light Transportation S&P 500 Index Note: The indices are derived from the equity performance of the previously listed companies. Source: Capital IQ Houlihan Capital 4

5 Recent M&A Activity in the Transportation & Logistics Industry April 1, 2016 to March 31, 2017 (USD in millions) Close Date Target Acquirer Target Company Primary Industry Implied Enterprise Value 4/26/2016 Harbor Guard Boats, Inc. N/A Marine $3, /14/2016 Virgin America Inc. Alaska Air Group, Inc. Airlines $2, /27/2016 Transportation Resources, Inc. TransForce Inc. (nka:tfi International Inc.) Trucking $ /10/2017 Northwest Parkway LLC HICL Infrastructure Company Limited; InfraRed Capital Highways and Railtracks $ /9/2017 Caito Food Service, Inc. and Blue Ribbon Transport, Inc. SpartanNash Company Trucking $ /1/2017 Aircraft Service International Group, Inc. Menzies Aviation plc; Menzies Aviation Inc. Airport Services $ /4/2016 Span-Alaska Transportation, Inc. Matson Logistics, Inc. Trucking $ /31/2016 The Apex Group Kerry Logistics Network Limited Air Freight and Logistics $ /1/2017 Total Terminals International, LLC Terminal Investment Limited (Netherlands) B.V Marine Ports and Services $ /1/2016 Providence and Worcester Railroad Company Genesee & Wyoming Inc. Railroads $ /7/2016 Southern Air Holdings, Inc. Atlas Air Worldwide Holdings, Inc. Air Freight and Logistics $ /30/2016 Golden State Overnight Delivery Service Inc. General Logistics Systems B.V. Air Freight and Logistics $ /9/2016 Chariot Transit Inc. Ford Smart Mobility LLC Trucking $ /6/2017 El Monte Rents, Inc. Tourism Holdings Limited Trucking $ /26/2016 Storey Park Perseus Realty, LLC; W-G Capital, LLC Trucking $ /31/2016 Express Tow & Salvage, LLC And CASH 1, LLC Moneyline 2027 (pty) Limited Highways and Railtracks $ /31/2016 Protection Services Inc. RoadSafe Traffic Systems, Inc. Highways and Railtracks $ /31/2016 Canadian Pacific Railway Limited, Obico Rail Yard N/A Railroads $ /3/2017 Flyte Tyme Worldwide Transportation Addison Lee Limited Trucking $ /18/2017 Specialty Business Assets J Line Corporation Marine $ /1/2016 Hybrid Logistics, Inc. and General Transportation Services, CAI International, Inc. Air Freight and Logistics $ /29/2016 Triumph Transport, Inc. and Triumph Repair Service, Inc. Central States Trucking Co. Trucking $ /31/2017 Palmdeal Shipping Inc. and Mondalva Shipping Inc. Interocean Transportation Inc. Marine $4.40 2/18/2017 Moringa Cooperative, Inc. Marapharm Ventures Inc. Trucking $0.38 3/31/2017 Seaward Marine Services, LLC and Accurate Marine MHI Holdings, LLC Marine Ports and Services N/A 3/28/2017 Premium Transportation Logistics LLC Magnate Worldwide, LLC Air Freight and Logistics N/A 3/24/2017 Worldnet International, London, Paris and Los Angeles N/A Air Freight and Logistics N/A 3/17/2017 Graebel Vanlines Holdings, LLC, Facilities in Florida, Suddath Van Lines, Inc. Trucking N/A 3/16/2017 Western Co-op Transport Association CHS, Inc. Trucking N/A 3/9/2017 Argo Turboserve Corporation, Industrial Division AgileX SC LLC Air Freight and Logistics N/A 3/7/2017 American Red Ball Transit Company, Inc. Interstate Group Holdings, Inc. Trucking N/A 3/6/2017 Simplified Logistics LLC CI Capital Partners LLC Air Freight and Logistics N/A 3/1/2017 Tempus Jets, Inc. Jackson River Aviation, LLC Airlines N/A 2/23/2017 Cargo Chief, Inc., Logistics and Transportation Services Genpro, Inc. Air Freight and Logistics N/A 2/15/2017 Twin America, LLC City Sights LLC Trucking N/A 2/8/2017 PPS Business Corporation Pitney Bowes Inc. Air Freight and Logistics N/A 2/3/2017 Login Logistics LLC Epes Logistics Services, Inc. Air Freight and Logistics N/A 2/2/2017 Fusion Logistics Worldwide Express Operations, LLC Trucking N/A 1/31/2017 American Cargo Express, Inc. OIA Global Logistics International Inc. Air Freight and Logistics N/A 1/25/2017 Groundlink Holdings LLC Marcou Transportation Group, LLC Trucking N/A 1/17/2017 KMR Aviation, Inc. West Coast Aviation Services LLC Airlines N/A 1/13/2017 TForce Critical Dynamex Inc. Air Freight and Logistics N/A 1/12/2017 Harbor Experience Companies New York Cruise Lines, Inc. Marine N/A 1/11/2017 TME Enterprises, Inc. DBi Services, LLC Trucking N/A 1/10/2017 Global Freight Source, Inc. GlobalTranz Enterprises, Inc. Air Freight and Logistics N/A 1/5/2017 C & S Carpet Distribution, Inc. Best Logistics Group, Inc. Trucking N/A 1/5/2017 Pathfinder Aviation, LLC Dos Rios Partners Airlines N/A 1/4/2017 One Island Park Island Global Yachting Ltd. Marine Ports and Services N/A 1/4/2017 Key Air, LLC and CIRRUS Flight Operations, Inc. Lynx FBO Network Airport Services N/A 1/3/2017 Railex LLC, Refrigerated and Cold Storage Distribution Union Pacific Corporation Railroads N/A 12/31/2016 Central Contracting & Marine Inc. SEACOR Holdings Inc. Marine N/A 12/31/2016 AmeriFleet Transportation, Inc. MetroGistics, LLC Trucking N/A 12/19/2016 TTS, LLC Sunteck Transport Group, Inc. Air Freight and Logistics N/A 12/16/2016 Gran-Aire, Inc. Spring City Aviation, Inc Airport Services N/A 12/15/2016 Marine Transport, Inc. Maverick USA, Inc. Trucking N/A 12/13/2016 MVP Logistics & Services, LLC Towne Park, LLC Air Freight and Logistics N/A 12/8/2016 envista, LLC, Capacity Solutions Brokerage Division R² Freight & Logistics, Inc. Air Freight and Logistics N/A Source: Capital IQ Houlihan Capital 5

6 S&P Capital IQ - Sector Last 3 Month Equity Performance 15.0% Change in Market Cap by S&P Capital IQ Sector 10.0% 5.0% 0.0% -5.0% -10.0% 12/31/2016 1/31/2017 2/28/2017 3/31/2017 Energy Materials Industrials Consumer Discretionary Healthcare Financials Information Technology Telecommunication Services Utilities Consumer Staples Note: The indices are derived from the equity performance of the S&P Capital IQ Sectors. Source: Capital IQ Houlihan Capital 6

7 M&A Deal Flow Statistics by S&P Capital IQ Sector 16,000 M&A Deal Count - Number of Transactions 14,000 12,000 10,000 8,000 7,080 6,957 8,845 7,176 7,735 7,544 8,953 7,561 8,024 8,265 8,970 7,120 6,788 6,011 6,954 6,702 6,000 4,000 2,000 4,204 4,641 5,372 4,647 4,989 5,391 5,700 5,147 5,062 5,134 5,244 4,543 4,297 4,033 4,197 4,316 0 $1,000 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q M&A Deals - USA & Canada M&A Deals - Rest of the World M&A Deal Count - Total Transaction Value ($ Billions) $900 $800 $700 $600 $500 $400 $354.4 $343.6 $409.1 $321.9 $372.8 $381.4 $462.7 $430.2 $512.6 $406.6 $440.3 $419.0 $268.0 $295.1 $445.7 $364.7 $300 $200 $100 $252.2 $246.4 $338.2 $400.7 $251.0 $289.7 $450.7 $402.3 $385.2 $499.4 $408.0 $403.0 $375.6 $293.7 $363.7 $363.7 $0 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Transaction Value - USA & Canada Transaction Value - Rest of World Houlihan Capital 7

8 M&A Deal Flow Statistics by S&P Capital IQ Sector Percentage Dollars Invested by Sector 1Q17 Consumer Discretionary Consumer Staples Energy Financials Healthcare Industrials Information Technology Materials Real Estate Telecommunications Services Utilities Not Listed Houlihan Capital 8

9 About Houlihan Capital Houlihan Capital is a leading, solutions-driven valuation, financial advisory and boutique investment banking firm. We pride ourselves on being thought leaders in an ever-changing landscape. Houlihan Capital is SOC-compliant, a FINRA and SIPC member and committed to the highest levels of professional ethics and standards. Valuation & Financial Advisory We provide an array of services that include enterprise valuations, portfolio valuation, valuation of carried interest, transaction opinions, tax and financial reporting compliance, purchase price allocations, and a wide variety of consulting services through our Financial Advisory Group. Investment Banking Through our Investment Banking Group, we offer sell side/buy side advisory, private placement and capital raises. Through our Special Situations desk, we provide services that fit outside the archetypal verticals, including liquidity solutions, transactional advisory, and secondary market advisory and trading. Litigation Support Our team provides support for a wide variety of situations including commercial and shareholder disputes, derivatives and structured finance litigation, and fraudulent conveyance. For additional information about our Industry expertise and services, visit: Andrew Smith asmith@houlihancapital.com Paul Clark pclark@houlihancapital.com Michael Norton mnorton@houlihancapital.com