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    Ariel Rosa • R. W. Baird & Co.

    Ariel Rosa's questions to GXO Logistics Inc (GXO) leadership

    Ariel Rosa's questions to GXO Logistics Inc (GXO) leadership • Q1 2025

    Question

    Ariel Rosa from Citigroup Inc. inquired about the Q1 increase in direct operating expenses as a percentage of revenue and its outlook for the year. He also asked about the potential run rate for share buybacks following a strong first quarter.

    Answer

    CFO Baris Oran confirmed the higher OpEx was due to the Wincanton acquisition's business mix and expects profitability to improve upon integration. Regarding buybacks, he stated that while shares are seen as attractive, repurchases will be balanced against other capital priorities, with an update to be provided at the end of Q2.

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    Ariel Rosa's questions to GXO Logistics Inc (GXO) leadership • Q4 2024

    Question

    Ariel Rosa from Citi inquired about the desire to shift GXO's geographic mix more toward the U.S. given FX headwinds. He also asked if the company could better insulate itself from periodic customer contract restructurings that can surprise investors.

    Answer

    CEO Malcolm Wilson confirmed that while M&A is on hold for deleveraging, the future focus for acquisitions will 'definitely be here in North America.' He clarified that customer realignments are not surprises to management due to long visibility and are part of proactively managing large, long-term partnerships in changing economic environments, describing the current situation as a 'onetime environment.'

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    Ariel Rosa's questions to GXO Logistics Inc (GXO) leadership • Q3 2024

    Question

    Ariel Rosa of Citigroup inquired about the drivers behind the returning demand for e-fulfillment, the potential impact of the U.S. election, and whether the new business win rate is increasing.

    Answer

    CEO Malcolm Wilson attributed the e-fulfillment rebound to a combination of GXO's sales force investments and, more fundamentally, growing customer confidence in the economic outlook. He suggested that elections bring certainty which encourages long-term investment. Wilson explained that GXO's win rate is higher in its core strength areas like e-fulfillment but naturally lower in newer verticals. CFO Baris Oran added that process improvements in the commercial organization are also contributing to better win rates.

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    Ariel Rosa's questions to Canadian National Railway Co (CNI) leadership

    Ariel Rosa's questions to Canadian National Railway Co (CNI) leadership • Q1 2025

    Question

    Ariel Rosa asked for context on the step-up in labor and benefits expense during the first quarter, particularly on a per-employee basis, and sought guidance on how to forecast it.

    Answer

    CFO Ghislain Houle broke down the 5% year-over-year increase in average compensation per employee. He attributed 2% of the increase to foreign exchange effects and the remaining 3% to regular wage inflation, providing a clear framework for the rise in labor costs.

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    Ariel Rosa's questions to Canadian National Railway Co (CNI) leadership • Q4 2024

    Question

    Ben Moore, on for Ariel Rosa, asked about Q1 operating ratio seasonality, suggesting the typical 400 bps sequential increase from Q4 might be smaller given the elevated Q4 2024 OR.

    Answer

    CEO Tracy Robinson and CFO Ghislain Houle both indicated that 2025 should see a return to more normal seasonality after a disruptive 2024. Houle reiterated the typical pattern: Q1 generally has the highest OR, with Q2 and Q3 being the strongest quarters, and they expect 2025 to follow this more traditional cadence.

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    Ariel Rosa's questions to Canadian Pacific Kansas City Ltd (CP) leadership

    Ariel Rosa's questions to Canadian Pacific Kansas City Ltd (CP) leadership • Q1 2025

    Question

    Ariel Rosa of Citigroup inquired about other regulatory areas being pursued with the FRA and how impactful they could be for cost savings and efficiency.

    Answer

    EVP & COO Mark Redd highlighted cold wheel detection technology, which has been successful in Canada, as a key opportunity. This technology improves asset turns and allows for more targeted mechanical work. He also mentioned portal inspections and other technologies that can detect more defects than the human eye, leading to a safer and more efficient railroad, though he did not quantify the savings yet.

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    Ariel Rosa's questions to Canadian Pacific Kansas City Ltd (CP) leadership • Q4 2024

    Question

    Ariel Rosa requested an update on the MMX intermodal service, including its rollout progress, customer receptivity, and how it's competing with a weak trucking market.

    Answer

    EVP and CMO John Brooks expressed that he is 'super pleased' with the MMX service's performance, noting it achieved 12% sequential volume growth from Q3 to Q4 despite a very tough trucking environment. He highlighted significant remaining opportunity to increase volume, improve freight mix, and expand the service's reach with the new CSX route into the U.S. Southeast. He also pointed to future upside from the refrigerated business, which has barely begun to be developed.

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    Ariel Rosa's questions to Werner Enterprises Inc (WERN) leadership

    Ariel Rosa's questions to Werner Enterprises Inc (WERN) leadership • Q1 2025

    Question

    Ariel Rosa inquired about potential mitigants for rising insurance costs beyond tort reform and asked for perspective on the freight market's supply-demand imbalance, including potential catalysts for a correction.

    Answer

    CEO Derek Leathers emphasized the need for tort reform while highlighting the company's focus on lowering accident rates as a primary internal control. CFO Chris Wikoff characterized the Q1 insurance expense as an outlier, referencing a more stable long-term average. Leathers added that while tariff uncertainty created disruptions, the current difficult environment should serve as a catalyst to accelerate capacity exits from the market.

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    Ariel Rosa's questions to ArcBest Corp (ARCB) leadership

    Ariel Rosa's questions to ArcBest Corp (ARCB) leadership • Q1 2025

    Question

    Speaking on behalf of Ariel Rosa, Ben Mor asked for a breakdown of the Q2 operating ratio improvement guidance, questioning if tariff headwinds were offsetting cost-out benefits.

    Answer

    Chairman and CEO Judy McReynolds stated the guidance incorporates all factors, including macro inputs and internal initiatives. Chief Financial Officer Matt Beasley highlighted that benefits from strategic investments in real estate and new equipment are driving efficiency, service improvements, and lower maintenance costs, which support the outlook.

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    Ariel Rosa's questions to ArcBest Corp (ARCB) leadership • Q3 2024

    Question

    On behalf of Ariel Rosa of Citigroup, an analyst asked about historical LTL operating ratio seasonality for 2025 and later inquired about the drivers of recent Mastio survey improvements and the remaining runway for those service initiatives.

    Answer

    CFO Matt Beasley acknowledged historical seasonality but emphasized the company's focus on controllable factors like service and pricing. President Seth Runser stated there is significant runway for service improvement, with a goal to be #1 in the Mastio survey. An executive added that future phases of city route optimization and other projects will continue to drive service and efficiency gains.

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    Ariel Rosa's questions to United Parcel Service Inc (UPS) leadership

    Ariel Rosa's questions to United Parcel Service Inc (UPS) leadership • Q1 2025

    Question

    Ariel Rosa inquired about UPS's efforts in robotics and warehouse automation to reduce labor dependency and the potential long-term cost savings from these initiatives.

    Answer

    CEO Carol Tomé stated that automation extends beyond sorting to include robotics for label application and trailer loading. Executive Nando Cesarone detailed the plan to have 400 automated facilities and close 200 others, creating a more efficient network with less labor dependency. Tomé connected this to achieving the 12% U.S. operating margin target by 2026, and CFO Brian Dykes noted that 64% of volume now goes through automated hubs.

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    Ariel Rosa's questions to United Parcel Service Inc (UPS) leadership • Q1 2025

    Question

    Ariel Rosa inquired about UPS's strategy to become less dependent on labor, focusing on the use of robotics, warehouse automation, and the potential long-term cost savings from these initiatives.

    Answer

    CEO Carol Tomé detailed automation efforts beyond sorting, including robotics for label application and trailer loading. Nando Cesarone, EVP and President, U.S., added that the plan includes 400 automated facilities and 200 closures, enhancing productivity and reducing labor dependency. Tomé linked these actions to achieving the 12% U.S. operating margin target by 2026, and CFO Brian Dykes noted automated hub volume is now at 64%.

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    Ariel Rosa's questions to United Parcel Service Inc (UPS) leadership • Q4 2024

    Question

    Ariel Rosa of Citigroup requested CEO Carol Tomé's long-term vision for UPS over the next 5-10 years, specifically asking for the size of the addressable market in key growth areas like healthcare and SMBs.

    Answer

    CEO Carol Tomé painted a future focused on complex logistics and differentiated capabilities that create customer stickiness. She highlighted healthcare as a major opportunity, with plans to grow revenue from $10.5 billion in 2024 to $20 billion by 2026, targeting a complex logistics TAM of over $80 billion. She also mentioned international diversification, particularly in Asia, as another key growth vector. She confirmed that while revenue targets will be reset, the company is focused on growth, not shrinking.

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    Ariel Rosa's questions to United Parcel Service Inc (UPS) leadership • Q3 2024

    Question

    Ariel Rosa inquired about the current level of excess capacity in the network and how UPS is planning to match resources with a weaker demand outlook.

    Answer

    CEO Carol Tomé stated that the team has done an 'excellent job' of removing capacity, highlighting that 45 operational closures have taken about 1 million average daily packages of capacity out of the network. She confirmed that while resources are being added for the peak season, overall network capacity is being actively rationalized to match demand.

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    Ariel Rosa's questions to Union Pacific Corp (UNP) leadership

    Ariel Rosa's questions to Union Pacific Corp (UNP) leadership • Q1 2025

    Question

    Ariel Rosa of Citigroup sought clarification on whether the 2025 EPS growth would specifically be in the high single to low double-digit range and asked about the drivers and sustainability of recent coal strength.

    Answer

    CEO Vincenzo Vena avoided committing to a specific 2025 EPS growth range due to market volatility but reiterated the company's commitment to its 3-year guidance. EVP Kenny Rocker attributed the coal strength to favorable natural gas prices and the team's agility in capturing demand, including new business wins, while acknowledging the volatility of gas prices.

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    Ariel Rosa's questions to Union Pacific Corp (UNP) leadership • Q4 2024

    Question

    Ariel Rosa of Citigroup inquired about the source of management's confidence in achieving an industry-leading operating ratio (OR) and asked about the structural advantages of the Union Pacific network.

    Answer

    CEO Vincenzo Vena positioned the operating ratio as an outcome of executing the core strategy: providing excellent service, maximizing price, and leveraging technology for efficiency. He expressed strong confidence that Union Pacific would deliver a leading OR, emphasizing that performance is driven by a focus on fundamentals rather than any single structural advantage.

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    Ariel Rosa's questions to Union Pacific Corp (UNP) leadership • Q3 2024

    Question

    Ariel Rosa of Citigroup Inc. asked if the company is currently achieving its goal of pricing above rail inflation and whether they are facing more customer pushback in the current loose capacity environment.

    Answer

    CFO Jennifer Hamann confirmed that pricing dollars are exceeding inflation dollars and have done so throughout the recent inflationary period. She added that this is expected to become accretive to margins next year. EVP Kenny Rocker noted that while the trucking market has been soft, the company's pricing mechanisms are in place, and they feel well-positioned for when capacity tightens.

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    Ariel Rosa's questions to CSX Corp (CSX) leadership

    Ariel Rosa's questions to CSX Corp (CSX) leadership • Q1 2025

    Question

    Ariel Rosa asked for a quantification of any lost customer business due to service issues and inquired about customer conversations regarding the potential impact of tariffs and ongoing policy uncertainty.

    Answer

    EVP and CCO Kevin Boone clarified there were no lost contracts, but rather missed growth opportunities, primarily in unit trains. CEO Joseph Hinrichs added that customer Net Promoter Scores remain high due to proactive communication. On tariffs, Boone noted the situation is fluid but presents a long-term positive for U.S. manufacturing on CSX's network.

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    Ariel Rosa's questions to CSX Corp (CSX) leadership • Q4 2024

    Question

    Ariel Rosa asked about the expected impact of tightening truck capacity on CSX's results, the typical lag for this effect, and which business segments beyond Intermodal would be affected.

    Answer

    EVP and CCO Kevin Boone explained that while Intermodal is the most obvious beneficiary, tightening truck capacity also accelerates truck-to-rail conversions on the Merchandise side as customers seek cost savings. He noted that Intermodal pricing lags the market, so a significant impact from a turn in the truck cycle would likely be seen more in the following year, with some potential benefit toward the end of 2025.

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    Ariel Rosa's questions to CSX Corp (CSX) leadership • Q3 2024

    Question

    Ariel Rosa inquired about the potential for intermodal pricing upside next year given the loose trucking market, and asked what CSX could do to accelerate revenue growth, possibly through mix shifts.

    Answer

    CCO Kevin Boone pointed to the success in the merchandise business as a positive mix factor for the company. Regarding intermodal pricing, he expressed cautious optimism for increases next year as the trucking market rebalances, which should create opportunities to convert more volume at better rates, though he expects the path to be gradual.

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    Ariel Rosa's questions to J B Hunt Transport Services Inc (JBHT) leadership

    Ariel Rosa's questions to J B Hunt Transport Services Inc (JBHT) leadership • Q1 2025

    Question

    Ariel Rosa from Citigroup asked about the prospects for year-over-year Intermodal margin improvement and whether post-COVID industry dynamics have made it harder to achieve steady earnings growth.

    Answer

    Darren Field, President of Intermodal, declined to provide a timeline for margin repair. CEO Shelley Simpson explained that the current cycle is unique because costs have continued to inflate while pricing has been pressured, unlike past recessions. She noted this dynamic makes smoothing out earnings more challenging and that some carriers may be operating with no margin just to survive.

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    Ariel Rosa's questions to J B Hunt Transport Services Inc (JBHT) leadership • Q4 2024

    Question

    Ariel Rosa questioned the 'normal seasonality' guidance for Q1, suggesting that given the 'unnatural costs' in Q4, the sequential performance should be better than normal, and asked about the prospect for improvement through the year.

    Answer

    Executive Brad Delco firmly reiterated that the guidance was intended to level-set market expectations, which the company perceived as disconnected from reality. While acknowledging the goal is always to outperform, he emphasized the guidance was a specific correction for Q1 and pointed to the company's overall optimism based on strong execution and future growth opportunities.

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    Ariel Rosa's questions to FedEx Corp (FDX) leadership

    Ariel Rosa's questions to FedEx Corp (FDX) leadership • Q3 2025

    Question

    Ariel Rosa of Citigroup asked for an update on long-term targets, given repeated downward guidance revisions, and inquired about the expected level of operating leverage when the macro environment improves.

    Answer

    President and CEO Rajesh Subramaniam acknowledged that revenue expectations have changed since original targets were set but emphasized that goals for improved operating margin and ROIC have been accomplished despite a weaker industrial environment. He expressed confidence that the new, more flexible cost structure will create significant leverage when the industrial economy returns to growth.

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    Ariel Rosa's questions to FedEx Corp (FDX) leadership • Q2 2025

    Question

    Ariel Rosa of Citigroup Inc. asked about the planned separation of FedEx Freight, inquiring about the key steps for a smooth transition and the potential risk of customer attrition.

    Answer

    President and CEO Raj Subramaniam affirmed the separation is intended to unlock shareholder value. He outlined that a separation management office has been established and that FedEx is hiring 300 new LTL-focused sales personnel to ensure a smooth customer transition. Subramaniam emphasized that commercial, operational, and technological agreements will remain in place to preserve the benefits of the relationship between the two companies and maintain a seamless customer experience.

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    Ariel Rosa's questions to Old Dominion Freight Line Inc (ODFL) leadership

    Ariel Rosa's questions to Old Dominion Freight Line Inc (ODFL) leadership • Q4 2024

    Question

    Ariel Rosa inquired about current inflationary cost pressures, particularly on the insurance line, and asked for clarification on the use of non-compete clauses for employees.

    Answer

    CFO Adam Satterfield projected core cost inflation of 4.0% to 4.5% for 2025, citing challenges in the insurance market despite ODFL's best-ever accident frequency. President & CEO Marty Freeman clarified that the company retains talent through its strong culture and compensation, not non-compete clauses, and noted that staff turnover is less than 1% annually.

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    Ariel Rosa's questions to Old Dominion Freight Line Inc (ODFL) leadership • Q3 2024

    Question

    Ariel Rosa asked for the logic behind favoring share buybacks significantly over dividends for capital returns and whether this signals that management views the stock as undervalued.

    Answer

    CFO Adam Satterfield explained that buybacks offer tax efficiency and crucial flexibility to fund large capital expenditures when growth accelerates. He described their approach as a consistent, grid-based program that buys more when the stock is lower, supplemented by larger, opportunistic repurchases during periods of significant stock weakness.

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    Ariel Rosa's questions to Kirby Corp (KEX) leadership

    Ariel Rosa's questions to Kirby Corp (KEX) leadership • Q4 2024

    Question

    Ariel Rosa of Bank of America inquired about the inland barge rate levels required to justify newbuilds, the expected margin trough in Q1, and the spot-to-term rate differential in the coastal market.

    Answer

    CEO David W. Grzebinski estimated that inland rates would need to increase by about 40% to justify new construction, noting spot rates are currently about 10% above term. He confirmed Q1 is expected to be the margin trough due to seasonality and a heavy coastal shipyard schedule. For coastal, he clarified the market is essentially 100% term-contracted with no meaningful spot market, and newbuild economics are even more challenging.

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    Ariel Rosa's questions to CH Robinson Worldwide Inc (CHRW) leadership

    Ariel Rosa's questions to CH Robinson Worldwide Inc (CHRW) leadership • Q4 2024

    Question

    Speaking on behalf of Ariel Rosa, Ben Moore asked management to characterize what 'inning' C.H. Robinson is in regarding its key growth initiatives: penetrating the SMB market and capitalizing on cross-selling opportunities.

    Answer

    President of North American Surface Transportation Michael Castagnetto and CEO David Bozeman both characterized the company as being in the 'early innings' on all fronts. They see significant runway for growth in the SMB vertical and a 'tremendous opportunity' to maximize value through cross-selling across business units. Bozeman added that the teams are highly energized and aligned with this growth strategy.

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    Ariel Rosa's questions to CH Robinson Worldwide Inc (CHRW) leadership • Q3 2024

    Question

    Ariel Rosa asked for commentary on changing competitive dynamics, citing a recent merger between two top-10 brokers and reports from asset-based carriers about gaining share from brokers.

    Answer

    CEO Dave Bozeman characterized the merger as a normal market event and stated C.H. Robinson is focused on its own execution. Michael Zechmeister, President of NAST, acknowledged a cyclical shift to asset carriers but said the company is competing effectively, gaining wallet share, and leveraging its drop trailer program. He noted that growing supply chain complexity ultimately favors flexible brokers.

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    Ariel Rosa's questions to Norfolk Southern Corp (NSC) leadership

    Ariel Rosa's questions to Norfolk Southern Corp (NSC) leadership • Q4 2024

    Question

    Ariel Rosa asked about the extent to which strong Q4 intermodal results were driven by a pull-forward of volume due to port stoppage threats, and whether managing this variability required adding extra costs or resources.

    Answer

    CMO Ed Elkins acknowledged some volume shifted to the East Coast but stated it was handled without significant disruption or additional resources, as it was incremental volume on existing, fluid train services. COO John Orr concurred, noting effective communication and a quick resolution to minor car supply issues allowed them to manage the situation well.

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    Ariel Rosa's questions to RXO Inc (RXO) leadership

    Ariel Rosa's questions to RXO Inc (RXO) leadership • Q3 2024

    Question

    Ariel Rosa of R. W. Baird & Co. asked about the confidence behind raising the Coyote synergy target so soon after the acquisition and the strategy to prevent customer or employee attrition. He also requested a breakdown of the Q4 adjusted EBITDA guidance.

    Answer

    CFO Jamie Harris explained the synergy target was raised to at least $40 million due to technology integration being ahead of schedule and greater-than-expected vendor overlap. CEO Drew Wilkerson addressed attrition concerns, citing the company's M&A experience, retention agreements with key leaders, and positive customer feedback. Wilkerson attributed the Q4 outlook to higher purchase transportation costs, a seasonal decline in Last Mile EBITDA after a strong Q3, and softness in the automotive sector.

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    Ariel Rosa's questions to Schneider National Inc (SNDR) leadership

    Ariel Rosa's questions to Schneider National Inc (SNDR) leadership • Q3 2024

    Question

    Ariel Rosa from Citigroup Inc. asked why revenue per truck per week was growing in both Dedicated and Network segments despite sequential declines in average truck count. He also questioned the record-high levels of operating supplies and insurance costs as a percentage of revenue and their expected range going forward.

    Answer

    CEO Mark Rourke clarified that while average Dedicated truck count was down, the quarter ended with a net increase, and network pricing discipline led to higher renewal rates. CFO Darrell Campbell explained that the operating supplies cost percentage was elevated due to a lower revenue base, lower gains on equipment sales, and leasing business costs. Regarding insurance, he noted that despite a 30% reduction in DOT-reportable accidents, a litigious environment and rising premiums are pressuring costs.

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    Ariel Rosa's questions to XPO Inc (XPO) leadership

    Ariel Rosa's questions to XPO Inc (XPO) leadership • Q3 2024

    Question

    Ariel Rosa of Citigroup asked about the risk of irrational pricing from competitors, given that the company and its peers are sitting on significant excess capacity.

    Answer

    Executive Mario Harik dismissed the risk, arguing that real estate is a small part of an LTL's cost base, making it illogical to chase unprofitable volume. He stressed that with industry demand still well below peak levels and a major competitor's capacity removed, the pricing environment remains rational and is set up for a strong upcycle.

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