MFT & 2 other NZX freight & logistics stocks to keep an eye on in March

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MFT & 2 other NZX freight & logistics stocks to keep an eye on in March

 MFT & 2 other NZX freight & logistics stocks to keep an eye on in March
Image source: Aun Photographer, Shutterstock.com

Highlights

  • The freight and logistics sector in NZ has witnessed a boom amid changing buyer habits and a surge in online shopping amid the COVID-19 pandemic.
  • Freightways reported a 7.7% rise in EBITDA on pcp in H1 FY22 due to a strong recovery after COVID-19-related lockdowns.
  • Move Logistics saw a positive recovery in Q2 FY22, which is expected to persist in H2 FY22.

The freight and logistics sector in NZ has witnessed a boom amid changing buyer habits and a surge in online shopping amid the COVID-19 pandemic. However, a rapid surge in Omicron cases in the country has left freight and logistics operators helpless with staff in isolation that in turn, was impacting the supply chain.

NZ is facing delays in unloading cargo at ports and a longer turnaround time for ships due to lower airline capacity, cargo reroute and isolation requirements. These issues have caused supply chain disruptions, forcing NZ to witness higher inflation.

On this note, let’s see how these 3 NZX transportation stocks are doing this month.

3 NZX Freight & logistics stocks and their details

Image source: © 2022 Kalkine Media®, Data source- Refinitiv

Mainfreight Limited(NZX:MFT) 

MFT reported an improving financial performance across regions for the period from 1 April 2021 to 31 December 2021 and weekly financial data for January 2022. However, global shipping and airfreight remain affected by congestion, high freight rates and the demand exceeding supply.

The Group shut its logistics services in Russia on 9 March due to the present clash between Russia and Ukraine.

GOOD READ: Hunting for transportation stocks? 3 NZX stocks that can be looked at

 MFT expects higher freight volumes as the year progresses while also handling service levels. In NZ, MFT’s domestic transport volumes and warehousing business stays at the highest levels as well the demand for Air & Ocean freight also remains strong.

On 21 March, at the time of writing, MFT was trading at $80.45, down 0.68%.

Freightways Limited(NZX:FRE) 

Freightways reported a 7.7% rise in EBITDA and a 5.6% increase in EBITDA on pcp in H1 FY22 due to a strong recovery after COVID-19-related lockdowns. The Group will pay an interim dividend of 18cps for H1 FY22.

DO READ: FRE & AIA: 2 transportation stocks to watch as petrol gets pricier

FRE remains encouraged by a strong trade in express packages and the resilience of FRE’s information management businesses. The Group is targeting revenue and earnings growth in FY22. However, it expects the COVID-19 impact to stay through higher volumes of home delivery and curbs to its business related to Omicron.

On 21 March, at the time of writing, FRE was trading at $12.23, down 0.65%.

Move Logistics Group Limited (NZX:MOV)  

Move’s revenue for H1 FY22 stood at $183.3 million with EBITDA down by 12.8% to $28.7 million. MOV also completed a capital raising of $40 million in the period.

The Group saw a positive recovery in the second quarter, which is expected to persist in H2 FY22. MOV also plans to remain focused on margin improvement and get rid of underperforming businesses.

On 21 March, at the time of writing, MOV was trading at $1.13, down 1.74%.

Bottom Line

Increased shipping time, supply shortages and rising costs of raw materials are posing a significant impact on the sector.

(NOTE: Currency is reported in NZ Dollar unless stated otherwise)

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