ArcBest, SAIA started at Buy as Jefferies sees undervalued opportunities
ablokhin
ArcBest (ARCB) and SAIA (SAIA) each gained bullish initiations on Monday as Jefferies told clients it sees undervalued names in trucking.
The firmâs analysts explained that it expects SAIA to see âabove-peer top-line growth and margin gainsâ over the long term as it continues to improve network density and execution.
SAIA was started at Buy with a $350 price target. ArcBest (ARCB) was also started at Buy on Monday, with an even greater projected upside with a $110 price target given its diversified operations.
âOur rating is based on our belief that the Street is discounting the company's multi-modal offering,â equity analyst Stephanie Moore said. âWith shares valued below the levels of the past two freight recessions, we believe ARCB is receiving no credit for the structural margin gains in its LTL business, or for its prospects of above-peer growth in an upturn.â
She added that she views TFI Internationalâs (TFII) notable stake in the logistics name as a potential catalyst as well. 
âWith TFI's track record of M&A (it bought UPS Freight for $800M), we perceive an interesting call option on ARCB shares, whereby TFI could potentially make an offer for some or all of ARCB's assets, though neither company has explicitly confirmed this. At current levels, we see the Street assigning $0 of value to this possibility,â she noted.
Elsewhere, Old Dominion Freight Line (NASDAQ:ODFL) was started at Hold due to its premium valuation as compared to its trucking industry peers. While the company is âbest-in-class within T&L,â according to Moore, it is fairly valued to reflect this status. 
More on Trucking stocks:
Knight-Swift, Werner Enterprises cut to Hold at Credit Suisse
Old Dominion Freight Line gains after Evercore ISI upgrade
ArcBest stock skids after Bank of America downgrade