We came across a bullish thesis on ArcBest Corporation on Valueinvestorsclub.com by leob710. In this article, we will summarize the bulls’ thesis on ARCB. ArcBest Corporation’s share was trading at $87.51 as of January 13th. ARCB’s trailing and forward P/E were 20.79 and 17.76 respectively according to Yahoo Finance.
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ArcBest (ARCB) is a century-old, multi-segment logistics operator anchored by a unionized less-than-truckload (LTL) network and an asset-light brokerage and managed transportation business. The company operates 239 service centers across North America, with roughly 56% of its ~15,000 employees represented by the Teamsters, making it the last publicly traded predominantly unionized LTL carrier.
ArcBest’s 2024 revenue of $4.53 billion is split between its asset-based LTL segment ($3.33 billion, 74% of total, 10.2% EBITDA margin) and its asset-light logistics segment ($1.20 billion, 3–4% EBITDA margin), enabling ~20,000 daily shipments with an average haul of ~1,100 miles. Its 2024 collective bargaining agreement locks in predictable 4.2% annual labor cost escalations through mid-2028.
The North American LTL market, valued at $85 billion, is highly consolidated, with the top 10 carriers controlling 75% of revenue. Yellow’s 2023 liquidation removed ~9–10% of national capacity, redistributing assets to rational operators and improving rate discipline, which directly benefits ArcBest.
Despite a deep freight recession from 2023–25, industry pricing has remained rational, and a modest manufacturing rebound could normalize volumes quickly. ArcBest’s unionized, higher-cost structure creates significant operating leverage: shipment weights collapsed in 2024–25, amplifying EBITDA declines, but any recovery in tonnage or oversized freight mix could dramatically lift earnings.
Trading near its liquidation value of $50–$84 per share, based on terminal, fleet, and brokerage assets, ArcBest offers asymmetric upside. A mid-cycle recovery could drive 2028 EPS to $10–12, while normalization in shipment weights could push EPS to $18–20, implying a 2–3x potential upside. Catalysts include industrial recovery, tonnage normalization, terminal monetization, and potential M&A. With limited leverage, a unique niche in LTL, and a hard-asset floor, ArcBest presents a compelling risk/reward opportunity for investors at the bottom of the cycle.
Previously we covered a bullish thesis on Old Dominion Freight Line, Inc. (ODFL) by Richard Toad in October 2024, which highlighted the company’s scale advantages, union-free cost structure, high ROIC, and disciplined network reinvestment. The company’s stock price has depreciated approximately by 12.49% since our coverage. The thesis still stands as ODFL’s operational moat remains strong. leob710 shares a similar perspective but emphasizes ArcBest’s unionized structure, higher leverage, and upside from freight recovery and asset monetization.
