Yahoo Finance Up 49% in Two Months, Is Cargojet Stock a Buy Today?
Written by Amy Legate-Wolfe at The Motley Fool Canada
Shares of Cargojet (TSX:CJT) stock continue to climb higher as the market seems to be on the road to recovery. Yet even after seeing shares rise 49% in the last two months alone, the company is still about half of all-time highs.
So, what do investors think about Cargojet stock? Is this it? Or could there be another rise in share price for the once-great company? Let’s take a look.
What happened?
Cargojet stock was one of the high fliers during the pandemic, when restrictions kept people at home, ordering online. These online orders rose significantly, leading to the company increasing its destinations as well as adding new aircraft.
Luckily, Cargojet stock had already made partnerships with some of the largest shipping companies on the planet. That includes Amazon and DHL, with multi-year deals signed to see the company bring its services to a global scale.
But even at home, Cargojet stock remained the only overnight cargo airline in the country. Things were going so well until they weren’t. With the market falling and restrictions ending, investors cut their losses. And this caused shares of Cargojet stock drop. So, what about now?
Undervalued
Cargojet stock has since been called one of the most undervalued stocks on the TSX today. Shares are down by (get this) 49% since all-time highs. And even with the most recent rise, analysts believe there should be more to come.
The last two years have been difficult, but now we’re on the verge of a recovery. Should interest rates and inflation come down, consumers will have more cash in their pockets. That cash can be used to buy the consumer goods that many have stayed away from over the last two years. And that will see another increase in the demand for Cargojet stock.
For now, however, shares may be up, but investors remain on the sidelines. This could come from the most recent earnings report, which saw revenue down year over year. Even so, analysts believe there is a strong outlook for this stock.
Analysts weigh in
After the company reported third-quarter results, analysts were pleased that the company continues to support lower-cost initiatives and balances that with increasing operating income and revenue as volumes recover. Overall, notes were positive, despite narrowly missing earnings estimates.
Cargojet stock is now continuing to focus on bringing costs down while preparing for the future. A future that will see a high rise in ecommerce use. Even so, the company remained focused on conservative projections, though analysts believe they could be even higher through to 2025.
So, in the very near future, analysts believe Cargojet stock will soar high once again. They’ve touted it as an outperformer, especially as it continues to bring in cash from fleet plans and asset sales. And as the company recently increased its dividend by a whopping 10%, along with its buyback plan, management seems confident, too.
Therefore, if you’re looking for some solid growth in 2024 and beyond, Cargojet stock could be of great consideration, even with shares up 49% in the last two months.
The post Up 49% in Two Months, Is Cargojet Stock a Buy Today? appeared first on The Motley Fool Canada.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Amy Legate-Wolfe has positions in Cargojet. The Motley Fool has positions in and recommends Cargojet. The Motley Fool recommends Amazon. The Motley Fool has a disclosure policy.
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