Landstar System Inc
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
$745.00 | Ppcl | Rhzctgdkh |
Freight Brokerage Backdrop Remains Challenged for Landstar, but Execution Solid
Business Strategy and Outlook
Landstar System ranks among the largest third-party logistics providers in the highly fragmented $140 billion-plus domestic asset-light truck brokerage space. Since Landstar doesn't own tractors, only a fleet of trailers, it has much lower operating leverage than pure asset-based truckload carriers. Thus, it enjoys a variable cost structure with relatively low capital intensity that generates solid capital returns—34% on average over the past seven years. Moreover, as one of the largest providers, Landstar has built a vast network of shippers, asset-based truckload carriers, and independent sales agents that support a wide economic moat, in our view.