Vroom Vroom! 3 NZX freight and logistics shares to keep an eye on

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Vroom Vroom! 3 NZX freight and logistics shares to keep an eye on

 Vroom Vroom! 3 NZX freight and logistics shares to keep an eye on
Image source: Aun Photographer, Shutterstock.com

Highlights

  • The logistics sector of any country plays a crucial role in transferring goods from the point of source to the point of consumption.
  • Mainfreight suspended its logistics services in and out of Russia on 9 March due to the ongoing conflict between Russia and Ukraine.
  • Freightways was buoyed by solid trade in the express package industry and the robustness of its information management system.

The logistics sector of any country plays a crucial role in transferring goods from the point of source to the point of consumption using an efficient supply chain network. The goods are transported via air, rail, road, etc. However, the industry has been facing many challenges due to the pandemic’s impact on global supply chain lines.

Retail and trucking companies have been facing supply chain issues due to Omicron-induced isolation and a shift towards online shopping. Moreover, disruptions have been caused because of the ongoing Russia-Ukraine conflict, surging fuel and food prices and higher freight costs amid the COVID-19 pandemic.          

Let’s look at how these 3 NZX Freight and logistic companies are performing.

Image Source: © 2022 Kalkine Media

Mainfreight Limited(NZX:MFT) 

Logistics services provider Mainfreight suspended its logistics services in and out of Russia on 9 March due to the ongoing conflict between Russia and Ukraine. The Group’s global shipping and airfreight stayed impacted by congestion, freight rates and excess demand in the period from April 2021-January 2022, as per its February trading update.

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MFT expects higher freight volumes and better services management as the year progresses. It plans to navigate constraints arising from Omicron-enforced absenteeism.

Shares of Mainfreight declined 1.21% in trading on Tuesday to close at $81.5. MFT has delivered 17.9% returns YTD.

Freightways Limited(NZX:FRE) 

Freightways posted net profit growth of 7.4% and a 7.7% increase in revenue for H1 FY22 on pcp after getting impacted by COVID-induced lockdowns. The Company will pay an interim dividend of 18cps.

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

Although the economic situation remained uncertain, the Company was buoyed by solid trade in the express package industry and the robustness of its information management system.

Shares of Freightways gained 0.08% in trading on Tuesday to close at $12.27. FRE has delivered 19.96% returns YTD.

Move Logistics Group Limited (NZX:MOV)  

Move’s fuel deliveries decreased substantially in Q1, but a positive recovery was seen in Q2 FY22. Move's sales for the first half of FY22 was $183.3 million, with an EBITDA of $28.7 million, down 12.8%. During the same time, MOV also completed a $40-million capital raise. MOV also intends to maintain its emphasis on improving margins and eliminating unproductive operations.

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Shares of Move Logistics declined 0.88% in trading on Tuesday to close at $1.13. MOV has delivered 1.8% returns YTD.

Bottom Line

Increased delivery time, supply constraints, and increased raw material costs are all posing challenges for the freight and logistics industry.

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

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