2Q26 Preview: Sparks, Not Fireworks

Research evidence excerpt

2Q26 Preview: Sparks, Not Fireworks

1 July 2026

Transportation

Figure 2: Stock performance since each name’s respective Q1 earnings release date (difference between the two

charts is only sorting, with the LHS sorted by performance and the RHS sorted by spread vs. peer group)

Source: Bloomberg Finance L.P., Deutsche Bank Research

It is the only name down since JBHT kicked off Q1 earnings season (4/15), and is

underperforming the S&P by 9 pp over that timeframe (see Figure 3).

Figure 3: Benchmarked to JBHT's previous earnings release date (4/15), the average transport stock is up 18%

(13% median; LHS) and o/p the S&P by 11 pp (6 pp median; RHS)

We see little fundamental justification for the magnitude of the

underperformance and believe the upcoming call offers management an

opportunity to reset the narrative with a healthy beat and solid guide. Strong

pricing should help XPO deliver the best y/y Q2 margin expansion in its industry

(+330 bps), bringing its three-year margin expansion to nearly 800 bps—well

ahead of ARCB (+260 bps), ODFL (+50 bps) and SAIA (-450 bps). We expect this

momentum to continue into Q3, supported by productivity gains, pricing

improvement, and a return to low-single-digit tonnage growth.

The problem(s), however…

1) Expectations for the group at large are high. Aside from XPO and a

handful of its peers, transport stocks have rallied meaningfully since last

earnings season: the average name is up 18% since JBHT kicked things

off and is outperforming the S&P by 11 pp (see Figure 3). Since Q1

earnings season concluded, the group has led the industrial tape, rising

14% on average versus the XLI’s +6% move; that’s even as estimate

revisions across that time period have barely moved. The stocks did pull

Deutsche Bank Securities Inc. Page 2