YRC Worldwide Inc (YRCW)

[yesmistermorningstar]

YRC Worldwide (YRCW): Freight Making Progress, Raising PT - Stifel

August 4, 2017 9:15 AM
Stifel analyst, David Ross, reiterated his Buy rating on shares of YRC Worldwide (NASDAQ: YRCW) and raised the price target to $18 after the company reported 2Q17 adjusted EBITDA of $91.1mm, right in the middle of its $86mm-$96mm preannouncement range. YRC Freight, which accounts for 63% of revenue and 53% of EBIT, is on the right track having exited a poor customer pricing agreement in May, and recently using the strength of June volumes to cull some unprofitable 3PL business and heavier-weight TL business to improve yields and network balance.

The analyst believes the company is looking to improve its operations and ride the wave of a better LTL market to a shore of significant equity shareholder returns over the next year. He stated "Its recent extension of the company's term loan maturity from 2019 to 2022 eliminated the D-Day scenario of all its contracts expiring at the same time, allowing for more breathing room and better negotiations with its union.

The new PT of $18 is up from $16.

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