On Monday, BMO Capital Markets adjusted its financial outlook for TFI International Inc. (NYSE:TFII:CN) (NYSE: TFII), reducing the stock price target to Cdn$140.00 from the previous Cdn$145.00, while maintaining a Market Perform rating on the stock.
The revision follows TFI International's announcement of a scaled-back near-term outlook due to ongoing difficulties in the freight market which impacted its first-quarter performance.
TFI International, which operates in the transportation and logistics industry, has seen its U.S. less-than-truckload (LTL) segment identified as a key area for profit enhancement. Despite this, BMO Capital suggests that without a general increase in seasonal demand across LTL markets, the near-term profit potential for TFI International is likely to be limited.
In response to these market conditions, BMO Capital has also revised its earnings per share (EPS) forecasts for TFI International. The firm now expects an EPS of $6.77 for the fiscal year 2024, down from the earlier estimate of $7.44. For the fiscal year 2025, the EPS projection has been lowered to $8.77 from the previous forecast of $9.56.
The decision to decrease the stock price target reflects the analyst's view that while TFI International has opportunities for profit improvement, the current market challenges are expected to temper growth in the near term. The Market Perform rating indicates that BMO Capital anticipates TFI International's stock performance to align with the broader market average.
InvestingPro Insights
Recent data from InvestingPro shows that TFI International (NYSE: TFII) has a market capitalization of $2.37 billion, with a P/E ratio of 24.06, reflecting the market's current valuation of the company. Despite the challenges highlighted by BMO Capital Markets, TFI International has a strong history of maintaining dividend payments, with a track record of 23 consecutive years, and a current dividend yield of 1.16%. This consistency may appeal to income-focused investors.
InvestingPro Tips reveal that analysts have recently revised their earnings expectations downward for the upcoming period, which aligns with BMO Capital's analysis. However, TFI International is still predicted to be profitable this year, with an adjusted P/E ratio of 24.13 for the last twelve months as of Q1 2024. The company's stock has experienced significant price movement, with a 28.89% return over the last six months, suggesting investor confidence in its long-term prospects.
For readers looking to delve deeper into TFI International's financial health and future outlook, InvestingPro offers additional insights and tips. With a coupon code PRONEWS24, readers can get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, granting access to a wealth of expert analysis and data to inform investment decisions. Find out more about these insights for TFI International at https://www.investing.com/pro/TFII, where several more InvestingPro Tips are available.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.