Is XPO a good stock to buy? We came across a bullish thesis on XPO, Inc. on R. Dennis’s Substack by OppCost. In this article, we will summarize the bulls’ thesis on XPO. XPO, Inc.’s share was trading at $205.29 as of June 30th. XPO’s trailing and forward P/E were 70.55 and 43.10 respectively according to Yahoo Finance.
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XPO, Inc., together with its subsidiaries, provides freight transportation services in the United States and internationally. XPO is the focus of a bullish volatility income trade where a seller wrote 3,000 August 21, 2026 $155 puts at roughly $2.00, collecting about $600,000 in premium, positioning for mean reversion after a sharp sentiment-driven pullback.
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Following a 12.6% weekly drawdown from $228.33 to $199.50, the move reflected sector de-rating, mixed LTL freight data, competitive pressure from broader logistics entrants, and macro headwinds from higher inflation and rate expectations.
Despite the selloff, implied volatility at 52.4% sat above 20-day realized volatility of 44.4%, creating an elevated premium environment where fear temporarily outweighed fundamentals. Fundamentals remained resilient, with Q1 2026 EPS of $1.01 versus $0.89 expected on $2.10 billion revenue, up 7.3% year over year, and return on equity of 26.21%, signaling operational strength despite short-term volatility. Analyst expectations remain supportive, with a median price target of $236 across 15 analysts, implying meaningful upside versus current levels, with estimates ranging from $210 to $240 across major brokerages.
The $155 strike sits roughly 22% below spot and beneath most of the year’s trading range, meaning the seller only begins to lose if the stock erases nearly all of its year-to-date gains within 60 days. Overall, the trade reflects a bullish view that panic-driven volatility in XPO is overstated, with time decay and normalization of freight sentiment expected to compress implied volatility and allow the seller to profit as price stabilizes above key support levels while analysts maintain a constructive medium-term outlook for the logistics cycle recovery and pricing power improvement.
Previously, we covered a bullish thesis on Old Dominion Freight Line, Inc. (ODFL) by Richard Toad in October 2024, which highlighted pricing power, scale advantages, and high ROIC within LTL logistics. ODFL’s stock price has appreciated by approximately 10.41% since our coverage. OppCost shares a similar view but emphasizes volatility-driven mean reversion and elevated implied volatility in XPO rather than structural moat expansion in freight markets.
XPO, Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 67 hedge fund portfolios held XPO at the end of the first quarter which was 46 in the previous quarter. While we acknowledge the risk and potential of XPO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than XPO and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
