Investment Q&A

TFII is now trading at 18x times' Forward P/E. In the 4Q, TFII’s revenue remained largely flat at $1.97B, beating estimates of $1.95B and EPS was $1.71 beating estimates of $1.67. The result beats both top and bottom lines. The balance sheet is okay with net debt of around $2B, and net debt/EBITDA is around 1.7x. TFII earlier had raised its dividend by 14% to $0.40 quarterly. The company recently announced a large transaction to acquire Daseke, expected to close in 2024-Q2, TFII has balanced its operations well between growing organically, investing in acquisitions and returning capital to shareholders consistently (repurchasing shares and raising dividends). Overall, despite challenging market conditions, the operating results came better than expected, along with other carriers such as ODFL, SAIA. We think TFII is an efficient operator, and still trading at a discount valuation compared to peers. On the call, the company re-emphasized its committment to buybacks, and discussed cash flow. It was coy on guidance, but indicated in the 1Q last year's $6+ in EPS is going to start with $7. We are quite comfortable with the story still.