Saia (SAIA): Assessing Valuation After Third Quarter Profit Slide and Slowing Earnings

Saia (SAIA) just released its third quarter earnings, grabbing investor attention as both sales and net income came in lower than last year. Earnings per share slipped for the quarter and year to date as well.

See our latest analysis for Saia.

Investors have taken notice of Saia's recent performance, with share price momentum clearly fading after its latest earnings miss. The stock now trades at $282.93, and while the company had posted strong gains over the past three and five years, with total shareholder returns of 32% and 69%, the past year saw a steep total return loss of over 50%. This sharp pullback suggests the market is recalibrating its expectations in light of slowing profitability, even as sales remain steady and the broader freight sector faces ongoing uncertainty.

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With shares down sharply from last year’s highs, but still trading above their pre-pandemic averages, the question is whether Saia’s latest slump signals a true buying opportunity or if the market has already adjusted for what’s ahead.

Most Popular Narrative: 14.5% Undervalued

Saia's fair value is estimated at $331.10, which is about 17% above its last closing price. This gap is catching attention as analysts point to financial levers unique to Saia. Let’s see what’s driving the narrative behind this valuation.

Strategic investments in logistics technology, network planning tools, and automation are beginning to yield structural cost savings and margin expansion. There is further long-term potential to differentiate Saia on service quality and operational efficiency, positively impacting net earnings and margins.

Read the complete narrative.

Curious how Saia’s relentless focus on tech and efficiency factors into this bold price target? Analysts hinge their optimism on projected margin gains, not just volume or topline hopes. Discover which future milestones shape this compelling story.

Result: Fair Value of $331.10 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent weak shipment growth and rising costs could challenge Saia’s outlook. This is especially true if network expansion fails to deliver expected volume gains.

Find out about the key risks to this Saia narrative.

Another View: Are the Numbers Too High?

While the consensus analyst price target points to meaningful upside, our DCF model tells a different story. It suggests Saia is actually trading well above its estimated fair value. This raises the possibility that the market is overestimating future growth or underappreciating key risks. Is the optimism reflected in today's share price sustainable, or are investors setting themselves up for disappointment?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Saia for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 850 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Saia Narrative

If you see the story differently, or want to dig into the numbers on your own terms, it only takes a few minutes to create a personalized view. Do it your way

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Saia.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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