According to Susquehanna Financial Group, several trucking companies are expected to gain advantages from the recent bankruptcy filing of Yellow Corp. In August, the Nashville-based less-than-truckload (LTL) company attributed its financial troubles to the actions of the International Brotherhood of Teamsters union.

Bascome Majors, an analyst from Susquehanna Financial Group, suggests that Yellow's struggles create opportunities for other businesses within the LTL sector. In a note released on Wednesday, Majors cautioned against clinging to the past and instead looked optimistically towards the future of LTL.

Specifically, Majors pointed out XPO Inc., TFI Internationals Inc., Forward Air Corp., Saia Inc., and Old Dominion Freight Line Inc. as potential beneficiaries. He emphasized the potential of XPO (which is experiencing a turnaround), TFII (which offers value), and FWRD (which is in a special situation). He also suggested considering entry points in SAIA or ODFL after the initial enthusiasm settles post-YELLOW.

Citi also identified FedEx Corp. as a company that could profit from Yellow's demise. In fact, FedEx raised its full-year profit outlook last month and its executives mentioned the "upside" resulting from disruptions at competitors like Yellow during an earnings call.

It is evident that the bankruptcy filing by Yellow has opened up new opportunities within the trucking industry, and companies like XPO, TFI Internationals, Forward Air, Saia, and Old Dominion Freight Line are well-positioned to benefit from this situation.

The Implications of Yellow Corp.'s Closure on the LTL Market

Susquehanna's Majors recently commented on the impact of Yellow Corp.'s closure, stating that while FedEx Freight's August quarter results provided some insight, the full effects on LTL (Less Than Truckload) bottom lines remain to be seen.

The Auction of Yellow's Terminals

Another significant aspect being considered is the upcoming auction of Yellow's terminals. According to Majors, 540 potential bidders are qualified to participate, aiming to create a more appealing offer than Estes' "stalking horse" bid of $1.525B. The outcome of this auction is uncertain, and Majors suggests that the redistribution of Yellow's terminals could unfold in numerous ways. However, Majors envisions the assets ultimately landing in the hands of an incumbent LTL operator, rather than a startup carrier, citing the potential for synergy opportunities.

The Long-Term Implications

Assuming Majors' prediction is correct, the majority of Yellow's footprint will likely re-enter the LTL market gradually over several years. This expectation underscores the significance of Yellow Corp.'s closure and its lasting reverberations throughout the industry.

Concerns and Expectations Among Truckers

The impact of Yellow Corp.'s shutdown has caused concern among truckers. In a recent survey conducted by Lance Surety Bonds, approximately 70% of the 332 respondents expressed worry about their job security due to Yellow Corp.'s closure. Additionally, 86% of those surveyed anticipated their companies hiring new drivers ahead of the busy holiday season.

The closure of Yellow Corp. continues to create ripples in the industry, with the long-term effects yet to be fully realized.

(Contributed by Bill Peters)