Expeditors International Of Washington: An All-Around For Customers And Investors?

Summary

  • One of the best quarter in the company’s history, with a 39% EPS increase.
  • Betting on technology might be the key to success for the transportation business.
  • A rocky road lays ahead with intensive competition showing up.

Expeditors International of Washington (EXPD) has observed a healthy growth during the last few years. The growth can be partly due to globalization and ease of doing business all around the world, but one does not stand long in markets with how competitive the transportation industry is if they cannot provide a value-added service. This is exactly why EXPD has been around for 40 years, stacking an impressive 24 years of dividend increase to their shareholders.

Understanding the Business

Founded in 1979, Expeditors International of Washington provides its customers an all-around transportation and logistics service. From regular day-to-day shipments to one of a kind needs, EXPD is up for the task. The company’s primary services are split into 3 categories: Airfreight Services, Ocean Freight, and Ocean Services and Customs Brokerage and Other Services. In 2017, 42% of their $6.92B revenue came from the Airfreight sector. 30% was earned by the Ocean sector and the remaining 28% by Customs Brokerage and Other Services. Although transportation is their main line of business, EXPD also offers supply chain solutions as well as warehousing and distribution.

The company now has regional offices around the world, having business partners in the Americas, Asia, Europe, Africa, India, and the Middle East. At the closing of 2017, EXPD employed over 16,500 workers around 177 offices.

Growth Vectors

Source: Ycharts

As the company is evolving in an ever-changing, fast-paced world, combined with tighter deadlines each and every day, EXPD is relying on an upgraded technology in order for them to keep up with those requirements. Artificial intelligence and machine learning operations have become a critical aspect of their business, with efficiency being the main targeted goal.

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Disclosure: We do not hold EXPD in our DividendStocksRock portfolios.

Disclaimer: Each month, we do a review of a specific industry at our membership website; Dividend Stocks Rock. In addition to ...

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