12/6

C.H. Robinson Poised for Growth: Citi Upgrades to Buy with $125 Target

Citi has upgraded C.H. Robinson Worldwide (CHRW) to a "Buy" rating, setting a target price of $125, ahead of the company's Investor Day. The report anticipates that CHRW will outline strategies for long-term growth and margin expansion, leveraging its leadership in brokerage, strong shipper and carrier relationships, and technological investments. Citi highlights the potential for CHRW to achieve high-single to low-double-digit annualized EPS growth, driven by productivity and cost-out initiatives. The brokerage industry’s recent competitive shifts, with tech-focused startups like Convoy exiting the market, have positioned CHRW to regain market share, particularly among small and medium-sized businesses (SMBs).

Citi's investment thesis is bolstered by CHRW's success in reducing costs and improving operational efficiency, which is expected to accelerate earnings growth as the freight market recovers. The report notes, "We have grown increasingly confident in management's ability to make meaningful progress on its cost-cutting efforts and operational efficiency improvements." Additionally, the ongoing industry consolidation is seen as a tailwind, enhancing the pricing environment for established brokers like CHRW.

CHRW's current stock price is $105.04, down 0.48% from the previous close.