Just as global supply chains were showing signs of slowly opening up, the spread of the COVID-19 omicron variant now threatens to disrupt supply chains again. Increased labor shortages in the trucking industry also continue to pose a concern. So, we think it could be wise to avoid trucking stocks Old Dominion Freight Line (NASDAQ:ODFL) and Yellow Corporation (YELL) now. Wall Street analysts expect the shares of these names to decline in the near term. So, read on.The trucking industry plays a significant role in transporting goods across regions. The $1 trillion infrastructure bill signed into law by the President on November 15 includes $550 billion in funding for transportation, broadband, and utilities. This could help boost the trucking industry’s prospects. However, supply chain issues pose a concern for the sector’s growth.
Pandemic-induced shortages have caused a jump in consumer prices, driving the highest surge in inflation in more than 30 years. Furthermore, just when supply chain issues were gradually easing, reports of a new coronavirus variant, omicron, are expected to be a spoilsport. In addition, a record truck driver shortage could further exacerbate the supply chain constraints.
Therefore, we think it could be wise to avoid trucking stocks Old Dominion Freight Line, Inc. (ODFL) and Yellow Corporation (YELL). Wall Street analysts expect them to decline in the near term. In addition, they look overvalued at their current price levels.