Analysts have upgraded Knight-Swift Transportation Holdings to a Buy rating, citing evidence that the freight cycle trough has passed. Over the past six months, truckload pricing has stabilized after a 3.3% year-over-year decline in loaded miles, while revenue per loaded mile (excluding fuel surcharges) rose 0.7% year-over-year and 1.4% sequentially. Less-than-truckload (LTL) revenue ex-fuel increased 7% year-over-year as shipments per day grew 2.1% and revenue per hundredweight rose 5%. Capacity has tightened across both segments, and cost-structure resets—including facility sales, headcount reductions and adjustments to equipment purchase plans—are expected to support robust margin and EPS expansion as volumes recover from current trough levels.

Knight-Swift reported Q4 GAAP results that included $52.9 million of non-cash impairment charges tied to the integration of the Abilene truckload brand into Swift. Revenue excluding fuel surcharge declined slightly, and operating income fell $51.5 million year-over-year; on an adjusted basis, operating income was down 5.3%. In truckload, revenue ex-fuel fell 2.4% year-over-year with a 3.3% drop in loaded miles. The combined adjusted operating ratio worsened by 70 basis points, though U.S. Xpress improved its ratio by 430 basis points to the mid-90s. In LTL, revenue ex-fuel rose 7%, but adjusted operating income declined 4.8% and the operating ratio widened 60 basis points as shipment growth lagged facility and door-count expansion (door count +10%). Logistics revenue fell 4.8%, pushing gross margin down 230 basis points sequentially to 15.5%. Intermodal improved its adjusted operating ratio by 140 basis points to 100.1% on a 2.8% increase in revenue per load, while the "all-other" segment saw revenue rise 17.7% and a $5.9 million year-over-year improvement in operating loss. Management guided Q1 adjusted EPS of $0.28 to $0.32 under assumptions of stable conditions in truckload and a seasonal recovery in LTL.