Modest 2Q Segment Beat, Though 3Q Sounding Better – but What Is in the Price?

Research evidence excerpt

Modest 2Q Segment Beat, Though 3Q Sounding Better – but What Is in the Price?

Idea

July 30, 2026 07:39 PM GMT

Morgan Stanley & Co. LLCMXPO Logistics, Inc. | North America Ravi Shanker

Equity Analyst

Modest 2Q Segment Beat, Ravi.Shanker@morganstanley.comNancy Hipp +1 212 761-6350

Research Associate

Nancy.Hipp@morganstanley.com +1 212 761-1311

Though 3Q Sounding Better – Madison J Pasterchick

Madison.Pasterchick@morganstanley.com +1 212 761-3787

but What Is in the Price?

XPO Logistics, Inc. (XPO.N, XPO UN)

Freight Transportation | United States of America

AlphaSignals Earnings Reaction

Stock Rating Underweight

Unchanged Modest upside Modest revision higher Industry View In-Line

Impact to our thesis Financial results versus consensus Direction of next 12-month Price target $115.00

consensus EPS Shr price, close (Jul 29, 2026) $199.38

Mkt cap, curr (mm) $23,806

Source: Company data, Morgan Stanley Research 52-Week Range $232.00-116.68

XPO’s 2Q was a decent beat vs. this quarter’s benchmark, Fiscal Year Ending 12/25 12/26e 12/27e 12/28e

EBITDA ($mm)** 1,271 1,503 1,674 1,825

though more modest at the segment level. 3Q color points to EBITDA ($mm)§ 1,250 1,451 1,633 1,843

upside potential to consensus, though it is clear that LTLs are at EPSEPS ($)**($)§ 3.733.62 5.324.96 6.136.09 7.077.37

least one step behind TLs on the cycle and more patience is ModelWare EPS ($) 3.73 5.33 6.13 7.07

needed for earnings to grow into the multiple. Unlessframeworkotherwise noted, all metrics are based on Morgan Stanley ModelWare

** = Based on consensus methodology

§ = Consensus data is provided by Refinitiv Estimates

Key Takeaways e = Morgan Stanley Research estimates

XPO delivered a strong 2Q beat, though the core LTL segment outperformed by a

more modest amount than consolidated results.