Here's How Much You'd Have If You Invested $1000 in Expeditors International a Decade Ago
How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in Expeditors International (EXPD) ten years ago? It may not have been easy to hold on to EXPD for all that time, but if you did, how much would your investment be worth today?
Expeditors International's Business In-Depth
With that in mind, let's take a look at Expeditors International's main business drivers.
Expeditors International of Washington Inc. is a leading third-party logistics (3PL) provider. The company, based in Seattle, WA, is engaged in the business of global logistics management, including international freight forwarding and consolidation, for both air and ocean freight.
As of Dec 31, 2021, Expeditors operated 176 district offices across the globe. Out of them, 70 were in Americas, 21 in North Asia, 16 in South Asia, 45 in Europe and 24 in areas covering Middle East, Africa and India.
The company also has branch offices, aligned with and dependent on a district office. Furthermore, the company has contracts with independent agents for providing services.
Expeditors, whose fiscal year coincides with the calendar year, has the following three reporting segments:
Airfreight Services (accounted for 41% of 2021 revenues) – Expeditors typically acts either as a freight consolidator, or as an agent for the airline carrying the shipment.
The company procures shipments from its customers, determines the routing, consolidates shipments bound for a particular airport distribution point, and selects the airline for transportation to the distribution point.
Expeditors also acts as a as a freight forwarder, whereby it receives and forwards individual, unconsolidated shipments and arranges the transportation with the concerned airline.
Ocean Freight and Ocean Services (34%) – Expeditors operates Expeditors International Ocean (EIO), an Ocean Transportation Intermediary, sometimes referred to as a Non-Vessel Operating Common Carrier specializing in ocean freight consolidation from Asia to the United States.
The company’s revenues as an ocean freight forwarder are also derived from commissions paid by the carrier and revenues from fees charged to customers for ancillary services, which the company may provide. The company does not own vessels, nor does it physically handle the cargo.
Customs Brokerage and Other Services (25%) – As a customs broker, the company assists importers to clear shipments through customs by preparing the necessary documents, calculating and providing for payment of duties and other taxes on behalf of the importer.
Bottom Line
Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Expeditors International a decade ago, you're probably feeling pretty good about your investment today.
According to our calculations, a $1000 investment made in December 2012 would be worth $3,087.12, or a gain of 208.71%, as of December 5, 2022, and this return excludes dividends but includes price increases.
In comparison, the S&P 500 gained 187.51% and the price of gold went up 1.91% over the same time frame.
Analysts are anticipating more upside for EXPD.
Expeditors is being hurt by declining volumes (with respect to air-freight tonnage and ocean container) due to wakening demand and falling rates. Volume- weakness is likely to persist in the near-term. Our current-quarter estimate with respect to air-freight tonnage volumes indicates a 9% year over year decline. High operating expenses represent another concern. However, we are impressed with EXPD's efforts to reward its shareholders through dividends and buybacks. EXPD has returned in excess of $1 billion to its shareholders through buybacks in the first nine months of 2022. We are optimistic about the company’s buyout of Fleet Logistics’ Digital Platform. The acquisition has boosted Expeditors’ online LTL shipping platform, Koho.
Shares have gained 21.78% over the past four weeks and there have been 4 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.
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Expeditors International of Washington, Inc. (EXPD) : Free Stock Analysis Report
