Wall Street Firm Sees Truckload Surge

In terms of freight volume, truckload carriers are doing better than many analysts expected in early 2010, thanks to a strong finish to 2009. Several carriers are outpacing Wall Street's expectations, according to investment bank Morgan Stanley.

"In general, we expect fourth-quarter 2009 truckload results to outpace consensus, with J.B. Hunt Transport Services, Werner Enterprises and Knight Transportation as the most likely beats," said Adam Longson, vice president of Morgan Stanley Research.

J.B. Hunt may benefit not only from increased truckload demand but new intermodal opportunities. Knight increased volume and expanded in drayage and brokerage and Werner should benefit from similar trends, Longson said.

"Given strong holiday demand trends and atypical strength in our truckload freight index, we've raised our expectations for truckload utilization and expect miles per truck to increase year-over-year for most carriers," he said in a note to investors.

Despite the increase in freight shipping, however, truckload rates were slow to climb in the quarter, Longson said. Excess capacity put a brake on price hikes.

"Year-over-year pricing declines should improve from the third quarter on easy comparisons, but positive year-over-year pricing trends may not materialize until mid-2010," he said.

Contact William B. Cassidy at wcassidy@joc.com.