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Con-way Inc (CNW), Knight Transportation (KNX): Economic Recovery Means Huge Profits for Trucking Companies

The new operations are still relatively small, and that represents major growth opportunities for the company. As the firm realizes maximum efficiency and growth in these segments, revenue will continue to grow at a staggering pace. This will allow those who invested in the company before its full capacity is realized to bask in the profits. Furthermore, the relatively young nature of these segments shows that the company will likely be able to increase its operational efficiencies, and that means a greater profit margin in the long run.

Trucking correlates with general economy

The trucking industry clearly has improving fundamentals, so if you are bullish on the economy then trucking companies could be right for you. I consider all three of these companies to be buys, but the contract renewal and price increase at Con-way Inc (NYSE:CNW) has me leaning towards that company’s stock. The network optimization and the increased price that the firm can gain from clients will position it to profit in the years ahead. Buying shares of the company now will allow your capital gains to accrue along with the firm’s growth. Con-way Inc (NYSE:CNW) looks determined to increase its less-than-truckload capacity, and as this is a segment that can generate huge profits it could take the firm to the next level.

Phillip Woolgar has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Phillip is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

The article Economic Recovery Means Huge Profits for Trucking Companies originally appeared on Fool.com is written by Phillip Woolgar.

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