Description: The passage wants to convey the topic on xpo employee portal. There will be the interview of XPO Logistics CEO Bradley S. Jacobs covering the idea about their secret of improving XPO. He will talk about something related to XPO logistics, the global provider of transportation and logistics services.
I want to judge the health of any given market, it’s always worth looking at the transports which are the best barometer of the overall state of Commerce which brings me to XPO logistics, the global provider of transportation and logistics services.
But this talk has been totally one Fireblade up over 40 percent year-to-date get this up eighty six percent over the past twelve months, what’s driving the strength?
XPO has a lot of exposure to some of the fastest-growing parts of the industry like less than truckload shipping many small freight and last mile services many getting packages to your door plus the company benefits enormous Lee from the explosion e-commerce now went XPO last reported a little more than a month ago.
The company delivered a solid quarter, perhaps more important management, they are ready to start making acquisitions after several years of inactivity, so can the stock keep climbing.
Let’s take a look, Bradley Jacob, the chairman CEO of XPO logistics find out more about how this company’s doing where it’s headed. Mr. Jacobs, welcome back to may have money who could see breath, have a seat.
I think they understand when some companies do acquisitions and people say they don’t know, but we all cheered when you said it, because we knew that you had digested the last ones.
When you do acquisitions, they are creative and fabulous, so we didn’t do acquisitions for two years and we were completely inwards focusing on integrating and optimizing and the integration is largely behind us now.
Now we are ready to go back, we’re well capitalized, we have the management bandwidth, we’re going to go out and do some accretive M&A and I think that if you can explain to our viewers, the scale that you can now bring to the situation how vital scale is for your business.
So we have about a billion dollars of liquidity on the balance sheet now and we have the ability to leverage up a little bit and buy something as much as seven or eight billion dollars and purchase without raising any more equity.
Now we may not buy that, we could know the reason why we want to do M&A. It is because of what you said, it’s creative to our EPS, I think that they’re sending, I gave some talks at the beginning about the business, that is very important to me less than truckload and obviously e-commerce.
But you spend four hundred and twenty five million dollars a year on technology which is about logistics, what about getting it right? Why do you need to spend that much money.
We have 1,600 full-time IT professionals on staff including over a hundred big data scientists, this is our secret sauce, this is our ability to do predictive analytics, this is our ability to do predictive pricing, this is our ability to do load optimization to route optimization, this is our ability to share information quickly and efficiently, this is how we get things done quickly.
It can handle hurricane, Harvey, can it handle? That’s a little much, we can’t handle, the Hurricanes were obviously very sad, it affected hundreds of our employees both in Texas and in Florida and now in Georgia as well.
So it slowed us down a little bit, we’ve made a fund internally, we raised about four hundred thousand dollars from our own employees and company matches those, it’s great, but now the transportation industry from a economic perspective will benefit from that.
Because there’ll be a big cleanup, that’s what I wanted to ask you about, because you are the chief strategy officer use of phrase and I’m so glad to use it, because some people are so tepid, there is an industrial, a lead economy, no one’s ever willing to say that.
But you’ve always been upfront when business is good and when business is bad, what does an industrial mean for that? When you went out to Peoria, you went out to Moline, it was terrible for a couple of years.
People were moping and they wouldn’t even look, it was like one time, it’s a totally different story, there’s a big skip, they are having same store growth, their sales are growing industrial economies back.
There’s no question about that and our biggest beneficiary that is our less than truckload business, we’re number two after FedEx. Let’s talk about the last mile people know.
Sears made a deal with Amazon deliver appliances, but everyone stood a lot, did living appliances to get it to the last mile they need, we’re the largest player in my logistics for heavy goods or anything over 150 pounds.
So we’re the leader in last my logistics for washing machines, for dishwashers, for refrigerators, for home exercise equipment, for furniture and we do 35000 thresholds a day that we cross.
It’s over 13 million deliveries a year, Italy, Spain, these are countries that we thought were dead too and there’s business, but going on there, business is definitely coming back in Europe, particularly since the elections are earlier this year.
Last mile in Europe, they’re way behind us and you can’t get anything deliver to your house, it’s incredible, you would go there and set this thing off, you order something and they’ll say we’ll get it there between Wednesday and Friday.
These are major companies that can’t get it, it’s a big opportunity to attack us to transplant that, but it’s the stone Age’s, let me show you about driverless trucks, I keep thinking, I don’t know if I want a gigantic truck.
I look over and there’s no one driving and it is far from it, it’ll be in state, we’re absolutely not, we’ll be in stages, we will start off with platooning, we have one truck, that’s got a driver and then two trucks following that with drivers, not doing very much.
Then over time, you won’t have drivers in the second and third one, this has fuel savings, this also decreases the overhead cost and then eventually, you won’t even have a driver in the front, so that’s where it’s going and within ten years maximum they’ll be fully autonomous trucks on the highway, that will be the norm.
We have a driver shortage by that point, we’ll have a driver access, drivers will be retooled, they won’t know that’s a job ten years from now, that has to be repurposed, that is right, you’ve got very different design.
Sometimes, it will be up to six months to find a driver, so I want to go back to e-commerce, there’s so much to talk about it and how big it is about the growth, but I need you to tell me, we keep thinking that it’s got a plateau, but that’s not right at all, is some data plateau, but it’s not plateauing now.
Some of our e-commerce customers are our fastest growing customers, there is no question about whether it’s in Europe where we’re the largest equal filament platform, whether it’s here where we’re doing a lot, we grew 45% in the most recent quarter in our omni-channel distribution, whether it’s in our last mile.
People used to not buy heavy goods online, do you know one thing I changed even since the time I’ve know you, I now see xbo logistics trucks everywhere, that’s the old Conway, what we plan is to have those hard assets, I like the light assets business.
Some of the businesses are better to be asset light, because you have more free cash flow and you don’t need the assets when our truck brokerage business, we don’t own the trucks for that, we have million outsource providers for that, but for LTL and intermodals, those two less than truckload and intermodal wheels.
You need the asset that the big shippers will not do a lot of bids, give you a lot of Freight unless you have some assets, I wish you, as I said this morning added to the transportation 2x, because you have a better handle in the economy and that’s why we like the transports and your thing is nurse.
There’s your cup bees on fire, it made it great, you stuck with this the whole way, Brad Jacobs, chairman CEO of xpo logistics xbo, you want an acquisition here, then the stock probably goes up about 35%, they have monies back into it, Jim Cramer here from there, see you on YouTube, click here to subscribe and get the jump on my exclusives with CEOs plus market news investing advice and a whole lot more.