As North America’s largest freight broker, C.H. Robinson (CHRW, Financial) links businesses across industries to transportation providers. As it does not own the trucks that do the hauling, the company runs an asset-light business model. After rallying strongly with the onset of Covid-19 in 2020, the stock has cooled off in recent quarters. The freight market tends to ebb and flow in tight cycles, and the stock of companies like C.H. Robinson has historically declined in anticipation of pricing weakness as additional trucking capacity comes online in response to peaking demand. However, as a middleman between haulers and those who seek to outsource their hauling needs, with a proven track record of overcoming logistical challenges and managing a complex regulatory environ-ment, C.H. Robinson is well positioned to perform through the cycles, in our view.
From First Eagle Investment (Trades, Portfolio) Fund of America's second-quarter 2021 commentary.
