October 24, 2007
Yesterday I sent you a report on what is happening in the home improvement market - and Home Depot in particular. The trucking industry is also reflecting this trend.
THE BEAR MARKET IN AMERICAN TRANSPORT
Yesterday, we signed off with a chart of America's largest home improvement chain, Home Depot. The Depot's weakness – along with the sinking stocks of many U.S. restaurant and retail chains – can only lead us to think the economy is in full slowdown mode.
Today, we look at another troubling economic sign... the plunging share price of YRC Worldwide.
Based in Overland Park, Kansas, YRC is one of the country's largest trucking companies. Clothes, refrigerators, La-Z-Boys, car parts, machinery, chemicals – you name it, YRC hauls it. Weak freight demand has sent shares down 40% in the past six months.
We're not picking on YRC... Pick any big trucker – Heartland Express, Saia, Landstar, Arkansas Best, Celadon Group – and the message remains the same: The housing market's destruction is seeping into all parts of the economy. Folks are buying less "stuff," and those who transport that stuff are suffering. Wall Street can't issue sell recommendations fast enough, earnings forecasts are being missed, and the bear market in American transport is on.
-Brian Hunt
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