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CH Robinson Worldwide Inc. Message Board

  • samuri_strategy samuri_strategy Mar 7, 2013 11:14 AM Flag

    Is this company making anything out of railroads?

    With gasoline up and trucking margins down rail road are the way. CHRW seems to be non-existent with rail roads?

    Sentiment: Strong Sell

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    • We own about 1000 containers but that isnt enough to make a difference. Like a flea on a buffalo's rear. We would need buy 10 times that or make a BIG aquisition to cause a ripple in the IMDL market.

      Sentiment: Buy

      • 1 Reply to chrwproud
      • I don't think the issue is about how many containers CHRW owns. I believe the issue is CHRW is not fully exploiting obvious opportunities. I don't believe CHRW will be purchasing additional containers. CHRW is primarily a Non-Asset Based Third Party Logistics Provider.
        That is not their business model. CHRW do not wish to own physical freight distribution assets. No trucks, no trailers, no warehouses. no office space, no employee truck driver or warehouse persons, etc. This frees CHRW of costs associated with management of acquisitions, financing, maintenance and upkeep, depreciation, employment, insurance, significant tax liabilities etc.
        The theory is, being a Non-Asset Based Third Party Logistics Provider allows CHRW the highest level of flexibility. It also results in CHRWs ROE (Return on Equity) and ROA (Return on Assets) and Total Debt/Equity ratios looking spectacular.
        Just because CHRW do not own containers that does not limit them from acting as an agent or broker for people that do own containers. On the trucking side CHRW works with approximately 56,000 companies and individuals that do own trucks.

        Sentiment: Hold

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