| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 35.34 | 26 |
| Intrinsic value (DCF) | 0.00 | -100 |
| Graham-Dodd Method | 15.56 | -44 |
| Graham Formula | 0.37 | -99 |
Werner Enterprises, Inc. (NASDAQ: WERN) is a leading transportation and logistics company specializing in truckload shipments across the U.S., Mexico, and international markets. Founded in 1956 and headquartered in Omaha, Nebraska, Werner operates through two key segments: Truckload Transportation Services and Werner Logistics. The Truckload segment includes medium-to-long-haul van fleets, expedited services, regional short-haul, and temperature-controlled transport, serving industries such as retail, consumer goods, food and beverage, and manufacturing. The Logistics segment offers non-asset-based solutions, including truck brokerage, intermodal rail, and last-mile deliveries. With a fleet of over 8,000 trucks and 27,000 trailers, Werner is a critical player in North American freight logistics. The company’s diversified service portfolio and asset-light logistics segment position it well in the competitive $800B+ U.S. trucking industry. Werner’s focus on efficiency, technology integration, and customer-specific solutions makes it a resilient operator in both cyclical and capacity-constrained markets.
Werner Enterprises presents a mixed investment profile. The company benefits from a diversified service mix, including asset-light logistics (25% of revenue), which provides margin stability amid freight rate volatility. However, recent challenges include compressed margins due to rising driver wages and fuel costs, reflected in its thin 1.1% net margin (FY2023). The stock’s beta of 1.1 indicates moderate sensitivity to economic cycles. Positives include a solid balance sheet (debt-to-equity of ~0.5x) and a 2.5% dividend yield, but capex demands ($414M in FY2023) may pressure free cash flow. Near-term headwinds from softening spot rates are offset by contractual pricing in dedicated fleets (~50% of truckload revenue). Valuation at ~0.5x revenue appears reasonable, but investors should monitor freight demand recovery and cost containment.
Werner’s competitive advantage lies in its dual focus on asset-based trucking and asset-light logistics, providing revenue diversification. Its dedicated fleet (~35% of truckload revenue) offers sticky customer relationships with multi-year contracts, insulating it from spot market downturns. The company’s scale (top 10 U.S. truckload carrier) enables efficient fleet utilization, though it trails industry leaders like Knight-Swift in profitability (WERN’s 8% operating margin vs. KNX’s 12%). Werner’s logistics segment competes with digital brokers like CH Robinson but benefits from integrated capacity via its owned fleet. Technology investments (e.g., predictive analytics for routing) improve efficiency, but its digital brokerage platform lacks the scale of Uber Freight. Regional density in the Midwest/South provides cost advantages, while intermodal partnerships (e.g., with BNSF) bolster multimodal capabilities. Key risks include reliance on owner-operators (15% of fleet) amid driver shortages and exposure to diesel price volatility (minimal hedging).