OTTAWA, Ont. — At least one financial analyst thinks the time is right to be investing in publicly-traded Canadian trucking firms, signaling the industry may be poised for a rebound.
Aaron Duxbury of National Bank Financial has upgraded his ratings for Transforce (to “outperform”) and Trimac and Contrans (to “sector outperform” for both). However, he warns the trucking industry still faces its challenges and will not likely lead the economy out of recession due to overcapacity concerns and high inventories.
“We do not expect truck volume to lead the economy this time,” Duxbury told the Globe and Mail. “In particular, while absolute inventories have fallen, sales have fallen much faster, sending the inventory-to-sales ratio to levels not seen since the early 90s.”
Duxbury said fleet reductions and fewer new truck purchases combined with fleet bankruptcies are “improving truck market dynamics,” according to a report in the Globe.
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