KNX Stock Forecast & Price Target

Knight-Swift, as the largest full-truckload carrier in the U.S., derives approximately 82% of its revenue from its asset-based trucking business, with a significant portion coming from full truckload services at 69% and less than truckload making up 13%. The company has demonstrated strong operational performance, evidenced by a 9.3% year-over-year increase in revenue per hundredweight (rev/CWT) and a reported increase of 80 basis points in operating ratio (OR) within the less-than-truckload segment, highlighting effective management strategies and potential margin improvement. Furthermore, Knight-Swift is poised to benefit from industry capacity tightness and expansion opportunities, particularly through its high-return asset-light businesses, which are expected to drive future earnings growth.

Knight-Swift's intermodal operations are currently facing significant challenges, as reflected in a 102% operating ratio (OR), with management anticipating weaker bidding conditions that will continue to pressure margins throughout the year, potentially delaying profitability until 2026. Additionally, the company's updated earnings per share (EPS) forecast for the second quarter indicates a midpoint reduction of approximately 40%, compounded by macroeconomic uncertainties that have led to the withholding of guidance for the third quarter. Furthermore, the risk of rising fuel prices poses a substantial threat to Knight-Swift's earnings, as shippers may pivot away from highway transportation, exacerbating the company's financial outlook.