Wednesday, November 02, 2011

Expeditors International (EXPD)

Expeditors International (EXPD) is a third party logistics provider offering worldwide consolidation services for air and ocean freight as well as custom brokerage and import services.

The company runs 250 full service offices and 50 international service centers in more than 50 countries on six continents. It has an outstanding record of profit and dividend growth (17% and 30% respectively) over the past 10 years, earning 16-20%+ return of equity. EXPD’s profits suffered as expected in recent economic down turn; however, longer term it should continue to achieve economic success as a result of:

(1) the recovery in the world economy in particular the strong trade between the US and Asia which should lead to strong gains in freight volume in the future,

(2) the company’s aggressive expansion into new services,

(3) as a global leader, EXPD should continue to increase its market share in this highly fragmented industry,

(4) an aggressive cost cutting program.


(1) its revenue is closely tied to consumer demand which decline if a ‘double dip’ occurs,

(2) it is in a highly competitive industry,

(3) it doesn’t control any transportation assets and therefore relies on the dependability of others,

(4) its large internationals operations subject it to the risks of currency fluctuations.

EXPD is rated A+ by Value Line, has no debt and its stock yields 1.2%

Statistical Summary

Stock Yield Dividend Growth Rate Payout Ratio # Increases Since 2001
EXPD 1.2% 13% 27% 10

Debt/Equity ROE EPS Down Since 2001 Net Margin Value Line Rating
EXPD 0% 20% 1 6% A+

*comparable industry data is not available


Note: EXPD stock made good progress off its March 2009 low, ultimately surpassing the down trend off its July 2006 high (straight red line) and the November 2008 trading high (green line). Until recently, the stock had been in a long term up trend; the black line is the lower boundary. It has re-set to a long term trading range (blue lines); it is also in an intermediate term trading range; the purple line is the lower boundary, the upper blue line is the upper boundary. The wiggly red line is the 30 day moving average. The Aggressive Growth Portfolio owns a 100% position in EXPD. The stock is currently on the Aggressive Growth Buy List. The lower boundary of its Sell Half Range is $92.