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Forward Air Corp. Message Board

  • yankeeboy4748 yankeeboy4748 Dec 7, 2005 6:34 PM Flag


    Great earnings forcast was based on oil at an average price of $ 65 a barrel. Oil is now at 59.21. So FWRD's earnings will continue to beat the Street estimates. Christmas this year will be much better than last year and that is also good for FWRD. Fair value for Foward is the $ 41-42 area. Based on earnings estimates, a six moth target price is $ 50.00. Excellent risk-reward ratio. Very Strong Buy under $ 41. It is my opinion that Raymond James is going to raise their earnings estimates for FWRD and upgrade the company to a strong buy.

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    • Boys and Girls:

      Forward Air is a good firm and will make money but there is change in the wind and folks will be leaving Towne and there will be new opportunity on the street.


    • Raymond James is not shown as one of FWRD analysts. Who would know if RJ did raise their earnings estimate for FWRD?

    • Now it's a buy. Assuming the company can grow FCFs at 12% for the next 5 years, 7% for the next 5 years, 5% for the 5 years after that, with terminal growth at 3% and a discount rate of 10%, I put the company's fair value at $40. At current levels, this well-managed cash-printer is trading at nearly 30% below its fair value. Quite a margin of safety. Time to take an interest in Mr. Market's pocketbook.

      • 1 Reply to mwbelval
      • I have no position in this stock,but I am in the industry.
        FWRD is loosing market share to competitors and pricing out quality clients. A private company Towne Air is the number one threat to FWRD, as you all may recall FWRD bought out Dedicated Express in 1998/1999..monopolizing the per pound air freight industry for a brief stint, only to have US Express create a joint venture with the former management via the name Express Global Logistics which they then bought out several years later after winning a lawsuit over the original name of the joint venture.

        Fuel prices do not effect the profitability of FWRD as the Fuel surcharges are priced in to the rate based on the current fuel price.

        I do not plan to short this stock or build a long position, but note I;ve seen this position remain fairly static in pricing for over 8 yrs.

    • Yeah that's what a
      smelly old fart told me.


    • the stock has fallen inside our buy value range which means that this is a great chance to buy a company at a cheap price. we bought the stock this morning

    • Also, Value Line upgraded this baby to a #1, which is their highest recommendation. Price will go up nicely over the next week.

    • OK - I'm pounding the table!!

    • Yankee,

      I agree with your analysis, except I'm still keeping my fair value at approximately $40-$41. My question is, with the stock closing today at $38.11, buying only gives you a 7% margin of safety (assuming a stock fair value of $41). That is a bit thin for me, especially when I originally purchased this stock with a fair value estimate of $40, and paid 26.18, which gave me a 36% margin of safety. I think for me it is time to enjoy that I purchased a bargain, let those who will buy that close to fair value drive the price up a bit more, and look for some stocks that have a greater margin of safety for me to buy. I love the company, and think that the stock is headed to the high 40's to low 50's, am looking forward to the ride, but I'm not sure the company is discounted enough to buy more right now. So I'm definitely a "hold," but should the market go haywire and take the stock back down to the low 30's, high 20's, I'd surely laugh at the silliness of Mr. Market and buy more.

      I'd love to hear other's comments about this.


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