Assessing Old Dominion Freight Line (ODFL) Valuation After Recent Short Term Share Price Gains

Old Dominion Freight Line (ODFL) has drawn interest after recent share price moves, with the stock showing mixed returns across different periods. This may prompt investors to reassess its current valuation and growth profile.

See our latest analysis for Old Dominion Freight Line.

The recent 1 day share price return of 3.15% and 7 day share price return of 6.01% add to a firmer 90 day share price return of 16.65%. However, the 1 year total shareholder return of a 5.84% decline contrasts with a 5 year total shareholder return of 70.11%, which together suggest differing performance over these periods.

If Old Dominion Freight Line has caught your eye, it could be a good moment to broaden your watchlist and check out fast growing stocks with high insider ownership.

So with shares up in the short term but still showing a 1 year total return decline and trading above the average analyst price target, is Old Dominion Freight Line now overpriced, or is the market still leaving you a buying window?

Most Popular Narrative: 8.3% Overvalued

With Old Dominion Freight Line closing at US$168.88 against a narrative fair value of about US$155.92, the narrative sees the shares trading at a premium while still leaning on specific growth and profitability assumptions.

Analysts are assuming Old Dominion Freight Line's revenue will grow by 6.1% annually over the next 3 years.

Analysts assume that profit margins will increase from 19.4% today to 21.2% in 3 years time.

Read the complete narrative.

Want to see what justifies paying up for this freight operator? Revenue climbing steadily, margins edging higher and a premium earnings multiple all sit at the core of this narrative. Curious how those ingredients combine to support a fair value below today’s price?

Result: Fair Value of $155.92 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, softer LTL tons per day and higher overhead costs, including depreciation, could pressure margins and challenge the earnings trajectory that supports this premium.

Find out about the key risks to this Old Dominion Freight Line narrative.

Build Your Own Old Dominion Freight Line Narrative

If you look at the numbers and reach a different conclusion, or simply like testing your own view against the data, you can build a custom thesis in just a few minutes with Do it your way.

A good starting point is our analysis highlighting 1 key reward investors are optimistic about regarding Old Dominion Freight Line.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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