Expediters International (EXPD) is a logistic company. It gets products from one country to another.
I’ve loved this stock for more than five-years. EXPD’s CEO is brassy and can often call-out analysts that doubt the company’s stock — even slamming them in reports. You’ll hear no negatives about EXPD out of me.
One-Year Chart
EXPD stock took flight during 2010 when it beat the street by 3 cents two quarters ago. The 68% growth was great, but that was compared to 2009’s light quarter, so the percentage gain looked good.
I put EXPD on the radar at the time, but didn’t buy the stock because the P/E was high. Back in August this 17% long-term grower was selling for 27 times earnings. The chart on the right is recent, and shows the high P/E didn’t stop the stock from going from $41 to $55 (+34%). I messed up not buying this stock — my reason was the P/E was too high. It wasn’t.
2011 profits are expected to be up 16% over 2010’s numbers. So once again this teens-grower has a P/E that’s almost double that number. You can view the earnings table here.
Ten-Year Chart
I looked back to EXPD’s ten-year results to try and figure out what P/E the stock, then guess what the P/E should be now. The number I came up with is 30. EXPD is a 15% grower that’s worth 30 times earnings.
I really want to own this stock, look at that ten-year chart — this is my type stock. The problem I have with EXPD now is the P/E is 30, so the stock’s not undervalued. Also, logistics was a big winner during the last decade due to expansion in China and underdeveloped countries. I don’t know if that growth rate will slow. Owning a high P/E stock when growth slows is a no-no because the P/E can fall.
Bottom Line
I’d like to get EXPD at 35 times earnings. That’s $1.85 x 25 = $46. With the stock at $55, a market decline could get this stock in range.
