One-glance verdict
Within fair range
$34.19 our estimate vs market $32.65
Wall Street consensus: $49.50 (44.8% higher than our fair-value estimate)
5% below our estimate
Fundamentals snapshot
Covenant Logistics Group, Inc.
CVLG · NYQ · Industrials · Trucking
Current price
$32.65
52-week range
$18.00 - $49.88
Market cap
$829.30M
Balance sheet
Stretched
1.70x Concerning
Net debt $312.79M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Returns 1.3% on equity, ahead of 40% of its peers.
- Reward Free cash flow was positive in 3/10 years.
- Risk Stock trades 585.7% above its 5-year average P/E.
- Risk Net debt grew 200.8% over 3 years.
What this company does
Covenant Logistics Group, Inc.
Covenant Logistics Group provides shipping and storage services to businesses, primarily earning money by moving goods for customers through trucks. This matters because efficiently transporting products is a key part of how companies get their items from where they are made to where people buy them, impacting their overall success.
How the company got here
Covenant Logistics Group, Inc. started in 1986 as Covenant Transport with just 25 trucks and 50 trailers, founded by David and Jacqueline Parker. Initially, the company focused on truckload shipping, particularly expedited services that required quick deliveries. Over the years, Covenant grew by acquiring other companies to expand its services and reach. Key acquisitions include Southern Refrigerated Transport in 1998 to add temperature-controlled shipping, Star Transportation in 2006 for regional truckload services, and more recently, AAT Carriers, ReedTMS Logistics, and Landair Holdings. These strategic moves transformed the company from a specialized truckload carrier into a diversified logistics provider, with its name change to Covenant Logistics Group in 2019 reflecting this broader scope.
What it actually does
Covenant Logistics Group provides a wide range of transportation and logistics services across the United States. Essentially, they help businesses move their goods from one place to another, ensuring timely and safe delivery. This involves managing fleets of trucks, coordinating with drivers, and using technology to track shipments. They serve various industries, including retail, manufacturing, food and beverage, and even the U.S. government, by offering solutions that ensure products reach their destinations efficiently.
Expedited
The Expedited segment focuses on moving freight that has very tight delivery deadlines, often requiring two-person driver teams to keep the trucks moving around the clock. This service is crucial for customers who need their goods delivered quickly and reliably, such as parcel delivery companies or businesses with just-in-time inventory needs. This part of the business is a significant contributor, making up about 28% of the company's revenue, and it's known for its high service standards and speed.
Dedicated
In the Dedicated segment, Covenant Logistics provides customers with a set number of trucks and drivers that are exclusively assigned to their needs for a contracted period, often several years. This offers businesses a consistent and reliable transportation capacity, ensuring their supply chains run smoothly without worrying about truck availability. This segment represents about 27% of the company's revenue and is characterized by longer-term customer commitments.
Managed Freight
The Managed Freight segment acts like a middleman, offering brokerage services where Covenant finds other trucking companies to haul a customer's freight. They also provide transportation management services (TMS), which means they help plan and manage a customer's entire shipping process, even if they don't own all the trucks involved. This segment accounts for roughly 24% of revenue and is considered an 'asset-light' part of the business, meaning it relies less on owning physical assets like trucks.
Warehousing
The Warehousing segment offers services to help businesses store and manage their inventory. This includes day-to-day warehouse operations, such as receiving goods, storing them, and preparing them for shipment. They also provide shuttle and switching services, which involve moving trailers and containers around freight yards or between warehouses and distribution centers. This segment adds another layer to Covenant's logistics offerings, helping customers manage their supply chains more comprehensively.
What management is betting on now
Covenant Logistics' current strategy is focused on evolving into a more diversified logistics and transportation platform, moving beyond its origins as a pure truckload carrier. Management is prioritizing the integration of recent acquisitions to enhance their managed freight and warehousing capabilities. They are also concentrating on improving profitability by focusing on contract-based services and increasing rates in their Expedited and Dedicated segments. The company aims to achieve greater capital efficiency by managing its fleet size more strategically and limiting capital expenditures, all while maintaining its reputation for reliable, high-service delivery.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$464.00K
FY2025 Q1
$-8.60M
FY2025 Q2
$-14.53M
FY2025 Q3
$-7.82M
FY2025 Q4
$-2.98M
FY2026 Q1
$17.59M
FY2026 Q2
$-44.65M
FY2026 Q3
$-7.13M
Revenue
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Net income
$10.70M
Diluted EPS
0.40
Operating cash flow
$26.75M
Free cash flow
$-7.13M
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Sources
Revenue
—
Net income
$8.54M
Diluted EPS
0.32
Operating cash flow
$-10.85M
Free cash flow
$-44.65M
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Sources
Revenue
—
Net income
$4.42M
Diluted EPS
0.17
Operating cash flow
$28.96M
Free cash flow
$17.59M
Fetching…
Sources
Revenue
—
Net income
$-18.26M
Diluted EPS
-0.68
Operating cash flow
$25.55M
Free cash flow
$-2.98M
Fetching…
Sources
Revenue
—
Net income
$9.09M
Diluted EPS
0.35
Operating cash flow
$41.36M
Free cash flow
$-7.82M
Fetching…
Sources
Revenue
—
Net income
$9.84M
Diluted EPS
0.36
Operating cash flow
$21.91M
Free cash flow
$-14.53M
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Sources
Revenue
—
Net income
$6.56M
Diluted EPS
0.24
Operating cash flow
$24.83M
Free cash flow
$-8.60M
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Sources
Revenue
—
Net income
$6.72M
Diluted EPS
-0.81
Operating cash flow
$21.93M
Free cash flow
$464.00K
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Sources
Is it cheap or expensive?
Fair value $34.19 vs current price $32.65
Wall Street consensus is the average analyst price target: $49.50 (44.8% higher than our fair-value estimate).
Our most-likely fair value is $34.19 a share — about 4.7% away from today's price of $32.65, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $312.8M. Interest coverage 1.7x.
Net debt
$312.79M
Interest coverage
1.70x
Covenant Logistics Group, Inc.'s profit covers its interest bill about 1.7 times over. which is stronger than every peer shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Stretched
Worse cushion
Baseline
Better cushion
CVLG
BASELINE
Covenant Logistics Group, Inc.
Total debt $316.73M Interest coverage 1.70x This is the baseline the peer rows are being compared against.
Total debt $114.18M Interest coverage -5.38x -100% vs CVLG This peer has almost no interest-payment cushion compared with CVLG.
Total debt $994.80M Interest coverage 1.43x -16% vs CVLG Carries about 1.2x less debt cushion than CVLG.
Total debt $678.05M Interest coverage 1.23x -28% vs CVLG Carries about 1.4x less debt cushion than CVLG.
What you should know
The case for and against CVLG
3 Rewards
3 Risks
Rewards
-
Returns 1.3% on equity, ahead of 40% of its peers.
-
Free cash flow was positive in 3/10 years.
-
Trades at 204.1x P/E vs peer median 284.6x (28.3% cheaper).
Risks
-
Stock trades 585.7% above its 5-year average P/E.
-
Net debt grew 200.8% over 3 years.
-
Insider ownership is only 26.0% (peer median: 40.4%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
204.06x
Forward P/E
12.16x
P/B
1.96x
P/S
0.64x
EV/EBITDA
9.73x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
19.4%
Operating margin
3.4%
Net margin
0.4%
ROE
1.3%
ROA
1.4%
Health
Liquidity and balance-sheet strength
Debt / equity
0.75x
Current ratio
1.15x
Quick ratio
0.97x
Total debt
$316.73M
Total cash
$3.94M
Growth
How the business has been compounding
Revenue TTM
$885.46M
Revenue 5Y CAGR
-21.6%
EPS TTM
0.16
EPS 5Y CAGR
-57.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$70.40M
Free CF TTM
$-33.92M
FCF margin
-3.8%
Dividend
Shareholder payout
Yield
0.9%
Payout ratio
175.0%
Last ex-div date
2026-09-04