The U.S. port strike is over. This is what it means for transportation and shipping stocks.

By James Rogers

The three-day dockworkers' strike impacted U.S. ports from Maine to Texas

The end of the three-day U.S. port strike has implications for a number of transportation and shipping stocks, say analysts.

Late Thursday, the International Longshoremen's Association and the United States Maritime Alliance said they had reached a tentative agreement on wages and agreed to extend their master contract until Jan. 15. The agreement ended a strike that affected U.S. ports from Maine to Texas and sparked fears of widespread economic impact.

Trucking company XPO Inc. (XPO), which reports third-quarter results on Oct. 30, stands to benefit from the resolution of the port strike, according to analyst firm Oppenheimer.

Related: Dockworkers union agrees to suspend port strike until Jan. 15 after tentative deal

"With the port strike now resolved, alleviating some near-term uncertainty, potentially lower interest rates enhance the attractiveness of XPO's current valuation looking to 2025E/beyond," wrote Oppenheimer analyst Scott Schneeberger in a note released Friday. Oppenheimer reiterated its outperform rating and $140 price target for XPO.

XPO shares ended Friday's session up 0.3% after ending Thursday's session down 1.4%.

However, the end of the strike is still keeping pressure on other transport stocks, according to J.P. Morgan.

"We initially stated that a strike lasting longer than a week would be a surprise given the economic and political consequences and stated that we'd fade any strength in transport stocks associated with the hope of a disruption-driven rate spike," wrote J.P. Morgan analyst Brian Ossenbeck in a note released Friday. "The market has given back some of these gains since the port strike started but we still expect pressure on truckload-rate-sensitive stocks including [Knight-Swift Transportation Holdings Inc.] and [J.B. Hunt Transport Services Inc.] along with forwarders [C.H. Robinson Worldwide Inc.] and [Expeditors International of Washington Inc.] now that the air-freight opportunity has been eliminated."

Opinion: Why the dockworker strike was really an aging-workforce issue

Knight-Swift Transportation Holdings shares (KNX) ended Friday's session down 3.1%, while J.B. Hunt Transport Services (JBHT) was down 1.3% at Friday's close. C.H. Robinson Worldwide's stock (CHRW) closed up 1.2%, while Expeditors International of Washington (EXPD) was down 1.7%.

"Generally the market shrugged off the impact of a strike on transportation stocks, with the exception of container liner companies or companies with direct container exposure," wrote Stifel analyst J. Bruce Chan in a note released Thursday. "This does remove an overhang on the broader economy, but we would expect some of the companies punished the most this week would be in line for the best near-term upside as business returns to normal."

Shares of container liner ZIM Integrated Shipping Services Ltd. (ZIM) have tumbled since the strike began, and ended Friday's session down 12.6% after losing 7.4% on Thursday.

Related: Dockworkers can make six-figure salaries without a college degree. So do these other blue-collar workers.

FedEx Corp.'s stock (FDX) was also weighed down by the strike action, ending Friday's session down 0.5% after losing 1.8% on Thursday. United Parcel Service Inc.'s (UPS) shares also tumbled this week, but ended Friday up 0.4%.

Shares of logistics and transportation company Matson Inc. (MATX) closed Friday's session down 0.1%, extending their losing streak to four days.

Rail stock CSX Corp. (CSX) ended Friday's session up 1.1% to snap a three-day losing streak. Rival Norfolk Southern Corp.'s stock (NSC) closed Friday up 1.2% after ending Thursday's session down 0.9%.

Related: These consumer-staples stocks could take a hit from the port strike

Stifel's Chan described the swift end to the port strike as a best-case scenario. "Three days should have very little impact on supply chains, inventory stockpiles, etc.," he wrote. "Frankly, the impact of Hurricane Helene is likely to be greater on transportation and logistics than the ILA strike."

-James Rogers

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10-05-24 0721ET

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