What Happened?

Shares of freight and logistics provider Covenant Logistics (NASDAQ:CVLG) fell 7.6% in the morning session after the company reported weak fourth quarter results. Its revenue missed significantly, and its Freight revenue fell short of Wall Street's estimates. The company's CEO called out a "challenging general freight environment" and added that in the Dedicated segment, "profitability fell short of our expectations due to greater-than-anticipated temporary customer shutdowns and volume reductions, as well as higher costs related to guaranteed driver pay and a large current period casualty claim expense". Overall, this quarter could have been better.

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What The Market Is Telling Us

Covenant Logistics’s shares are not very volatile and have only had 2 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

Covenant Logistics is up 2.6% since the beginning of the year, but at $27.49 per share, it is still trading 9.4% below its 52-week high of $30.33 from November 2024. Investors who bought $1,000 worth of Covenant Logistics’s shares 5 years ago would now be looking at an investment worth $4,032.

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