XPO shares have climbed roughly 40% year to date following the release of fourth-quarter results and an Institute for Supply Management manufacturing survey signaling expansion for the first time in over two years. With U.S. manufacturing volumes estimated 15–17% below normalized levels, a sustained industrial rebound could drive volume growth and pricing power for the less-than-truckload carrier. However, the current valuation, reflected in a price-to-earnings ratio near 50, indicates that much of this anticipated recovery may already be factored into the share price.

For the quarter ended December 31, XPO reported GAAP diluted earnings per share of $0.50, down from $0.63 in the prior year period, on total revenue of $2.01 billion, a 4.7% increase from $1.92 billion. Adjusted diluted EPS was $0.88, essentially flat with last year’s $0.89, while adjusted EBITDA rose 3.0% to $312 million from $303 million. Operating income of $143 million compared to $148 million a year ago, and net income fell 22.4% to $59 million. The company generated $226 million of operating cash flow and ended the period with $310 million in cash after $84 million of capital expenditures, $65 million of share repurchases and $65 million of term-loan repayments.

In North American less-than-truckload operations, revenue increased 0.8% to $1.165 billion and adjusted operating income grew 13.8% to $181 million, lifting the adjusted operating ratio by 180 basis points to 84.4%. Yield per shipment excluding fuel rose 5.2% even as shipments declined 1.6% and tonnage fell 4.5%. European transportation revenue jumped 10.6% to $846 million, while adjusted EBITDA improved 18.5% to $32 million despite an operating loss of $13 million. Corporate expenses included a $7 million increase in restructuring and integration costs, leading to a $28 million operating loss at that level.