JPMorgan Chase & Co. Upgrades RXO (NYSE:RXO) to Neutral

Key Points

• JPMorgan upgraded RXO from “underweight” to “neutral” and raised its price target from $22 to $30, implying approximately 4.8% upside from the reported share price.
• Analyst sentiment remains broadly cautious, with five Buy, fourteen Hold and one Sell rating; the consensus rating is “Hold” with a $24.49 target price.
• RXO recently exceeded quarterly EPS and revenue estimates, reporting $0.06 EPS and $1.77 billion in revenue, while its pending acquisition by C.H. Robinson offers implied consideration of about $30.25 per share but carries merger-completion and shareholder-review risks.

RXO (NYSE:RXO - Get Free Report) was upgraded by equities research analysts at JPMorgan Chase & Co. from an "underweight" rating to a "neutral" rating in a report issued on Tuesday, Benzinga reports. The brokerage presently has a $30.00 price target on the stock, up from their prior price target of $22.00. JPMorgan Chase & Co.'s target price suggests a potential upside of 4.82% from the stock's current price.

Several other research analysts have also issued reports on the company. Stephens upgraded RXO to a "hold" rating in a research report on Wednesday, July 8th. Weiss Ratings reiterated a "sell (d-)" rating on shares of RXO in a report on Tuesday, September 1st. Wells Fargo & Company reissued a "positive" rating on shares of RXO in a research note on Thursday, September 10th. Citigroup reaffirmed a "neutral" rating on shares of RXO in a research report on Tuesday. Finally, Benchmark reiterated a "hold" rating on shares of RXO in a report on Tuesday, July 28th. Five analysts have rated the stock with a Buy rating, fourteen have assigned a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat, RXO has an average rating of "Hold" and a consensus target price of $24.49.

RXO Price Performance

Shares of RXO stock opened at $28.62 on Tuesday. The stock's fifty day moving average is $21.18 and its 200-day moving average is $21.93. The company has a debt-to-equity ratio of 0.30, a quick ratio of 1.27 and a current ratio of 1.27. RXO has a 52 week low of $10.43 and a 52 week high of $29.90. The stock has a market capitalization of $4.72 billion, a PE ratio of -46.92 and a beta of 2.10.

RXO (NYSE:RXO - Get Free Report) last announced its earnings results on Thursday, August 6th. The company reported $0.06 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.04 by $0.02. The company had revenue of $1.77 billion for the quarter, compared to analyst estimates of $1.63 billion. RXO had a negative net margin of 1.72% and a negative return on equity of 0.98%. RXO's quarterly revenue was up 25.0% on a year-over-year basis. During the same period in the prior year, the business earned $0.04 earnings per share. Equities research analysts expect that RXO will post 0.14 EPS for the current fiscal year.

Hedge Funds Weigh In On RXO

A number of large investors have recently modified their holdings of the business. City Holding Co. grew its holdings in shares of RXO by 227.6% in the 2nd quarter. City Holding Co. now owns 1,245 shares of the company's stock valued at $34,000 after acquiring an additional 865 shares in the last quarter. Cassaday & Co Wealth Management LLC acquired a new position in RXO during the first quarter valued at approximately $29,000. Nykredit A S acquired a new position in RXO during the second quarter valued at approximately $67,000. Public Employees Retirement System of Ohio grew its stake in RXO by 18.3% in the first quarter. Public Employees Retirement System of Ohio now owns 4,196 shares of the company's stock valued at $61,000 after purchasing an additional 649 shares in the last quarter. Finally, Integrated Wealth Concepts LLC bought a new position in RXO in the second quarter valued at approximately $133,000. 92.73% of the stock is currently owned by institutional investors and hedge funds.

RXO News Summary

Here are the key news stories impacting RXO this week:

• Positive Sentiment: RXO shareholders are set to receive $17.25 in cash plus 0.0856 shares of C.H. Robinson for each RXO share, representing implied consideration of about $30.25 per share. The deal values RXO at a substantial premium to its pre-announcement trading level. C.H. Robinson to buy RXO for $5.8 billion in truck broking expansion
• Positive Sentiment: Management expects approximately $300 million in annual synergies and says the transaction should be accretive to earnings in less than one year. The combination would create a third-party logistics company with enterprise value exceeding $25 billion and expand C.H. Robinson’s North American truck-brokerage presence. Why C.H. Robinson stock was tumbling today
• Neutral Sentiment: The transaction is structured with both cash and stock, and RXO investors are expected to own roughly 11% of the combined company. RXO’s market price remains below the stated implied consideration, reflecting normal merger-completion risk and uncertainty over C.H. Robinson’s future share price. C.H. Robinson agrees to acquire RXO
• Negative Sentiment: Investor-rights law firms, including Halper Sadeh, Brodsky & Smith and Ademi, announced investigations into whether RXO is receiving a fair price and whether the deal provides adequate benefits to shareholders. Such reviews could create negotiation or closing risks, although no formal challenge to the transaction was announced. RXO Stock Alert

About RXO

RXO, Inc is a transportation services company that provides asset-light freight brokerage and logistics solutions. The company connects shippers with independent carriers and helps coordinate the movement of truckload, less-than-truckload and other freight across North America.

RXO's services include digital freight brokerage, managed transportation and last-mile logistics. Its brokerage business uses technology and carrier relationships to match customer shipments with available transportation capacity, while its managed transportation offerings help companies plan, coordinate and optimize freight operations.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.