C.L. Werner, who earlier this month was renamed chairman of the board at Werner Enterprises, has now resumed the duties of CEO as well, the truckload giant reported in a statement Friday.
“As Werner Enterprises continues to develop its talented management team, Greg Werner has decided this is the perfect time to retire as chief executive officer,” the statement reads. “Going forward, C.L. plans to groom existing president and chief operating officer, Derek Leathers, for an even larger role in the company.”
Greg Werner, who has been CEO since 2007 and has 40 years with the 7,000-truck fleet, will remain on the board along with brother Gary, who stepped down as chairman two weeks ago and who now serves as vice chairman.
C.L. Werner founded Werner Enterprises, driving its one truck, in 1956. The company reported revenues of $534.6 million in the second quarter, about the same as the second quarter last year. Net income, at $31.8 million, was up 24%. The stock price, however, is down about 15% so far this year.
Stifel investment analyst John Larkin, in a note to clients last week, points out that truckload stocks, as a group, are down 17.8% so far this year, but this “dramatic drop” seems “unwarranted” and share price corrections have been “overdone,” given solid financial results over the past three quarters.
“We suspect that some investors, with a shorter term investment horizon, had been following the decline in spot market pricing earlier in 2015, and concluded that lower spot pricing should lead to lower contract pricing,” Larkin writes. “This time around, perhaps due to the anticipation of a capacity crisis (given the driver shortage and the coming onslaught of federal safety-oriented regulations), spot prices and contract prices have remained de-linked throughout 2015.”
Indeed, truckload capacity has remained “in check,” and likely will tighten with coming federal rules on electronic logs and speed limiters, Larkin suggests.
Stifel maintains a “hold” rating on Werner stock.
