Less-Than-Truckload Carrier SAIA's Critical Mass Poised To Drive Service Levels: Analyst

BMO Capital Markets analyst Fadi Chamoun initiated coverage on Saia Inc SAIA with a Market Perform rating and a price target of $450.

The analyst says that SAIA is a well-managed company with a strong execution track record.

The analyst's rating reflects a valuation that is at the high end of the historical range and a muted macro outlook.

SAIA now has the critical mass (with 194 terminals) needed to drive strong service levels to push volume, density, and pricing growth over the coming years, writes the analyst.

The analyst forecasts a FY23-FY28 EPS CAGR of 16.3%, including projected growth of 21.7% in FY24, which supports significant share price appreciation over the medium term.

Chamoun expects revenue and EPS of $2.87 billion and $13.17 (vs. consensus: $13.16) for FY23, $3.285 billion and $16.03 (vs. $16.14 street view) for FY24, and $3.564 billion and $18.86 (vs. $18.84 cons.) for FY25.

Last month, SAIA reported third-quarter FY23 revenue growth of 6.2% year-over-year to $775.1 million, beating the consensus of $745.98 million.

Also Read: These Analysts Revise Their Forecasts On Saia Following Q3 Results

Price Action: SAIA shares are trading higher by 0.32% at $423.93 on the last check Wednesday.