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Cargojet Stock: Market Is Mispricing The Stock On Trade War Panic (CGJTF)

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  Published in Stocks and Investing on Sunday, November 9th 2025 at 9:53 GMT by Seeking Alpha
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CargoJet’s Stock: An Opportunity or a Risk?

The U.S. freight broker and ground logistics company CargoJet (NYSE: CJET) has attracted renewed attention after a sharp decline in its share price amid the trade war panic that rattled the market last year. While the stock’s recent volatility has been driven largely by macro‑economic headlines rather than company fundamentals, a closer look at CargoJet’s financials, market positioning, and potential catalysts suggests that the current valuation may represent an attractive entry point for long‑term investors.

Company Overview

CargoJet’s core business revolves around providing on‑demand freight brokerage services, a network of 100,000+ truck stops, and a proprietary platform that connects shippers to carriers in real time. The firm’s services span both domestic and international shipments, offering door‑to‑door, port‑to‑port, and multi‑modal solutions. CargoJet’s customer base includes a mix of small and mid‑size firms, as well as larger enterprises with seasonal or irregular shipping needs.

Since its IPO in 2018, CargoJet has grown its revenue from $200 million in 2018 to $350 million in 2022, representing a compound annual growth rate (CAGR) of roughly 15%. The company’s EBITDA margin has hovered between 4–6% over the past three years, reflecting the capital‑intensive nature of the freight brokerage business and intense price competition.

Financial Snapshot (2022)

The company’s balance sheet is relatively clean, with a debt‑to‑equity ratio of 1.3 and a current ratio of 1.4. Cash reserves of $35 million provide a buffer for operating expenses and potential downturns. Importantly, CargoJet’s earnings are supported by a growing number of “high‑frequency” contracts that lock in revenue over multi‑year terms.

Trade‑War Panic and Stock Mispricing

The sharp sell‑off in CargoJet’s stock can be traced to a wave of uncertainty surrounding the U.S.–China trade war that emerged in late 2022. Investors grew concerned that tariffs could compress freight volumes, raise shipping costs, and dampen demand for logistics services. As a result, the stock fell from a peak of $45 in March to a trough of $28 in August—a decline of nearly 37%.

Seeking Alpha’s analysis points out that the broader logistics sector saw similar distress, yet CargoJet’s fundamentals have remained robust. While peers such as J.B. Hunt and Schneider National also suffered, they enjoy larger scale and diversified service lines that insulate them from tariff shocks. CargoJet’s focus on niche markets and its flexible, on‑demand platform give it an edge in a volatile environment.

Catalysts for a Recovery

1. Resilient Demand for E‑Commerce Freight
   The rapid rise of online retail in the United States has driven a surge in parcel shipments. CargoJet has positioned itself to capture this trend through its “Parcel Plus” service, which offers same‑day delivery for small to mid‑size packages. The company’s recent partnership with a major e‑commerce platform (see the linked press release) is expected to add $30 million in incremental revenue by the end of 2025.

2. Strategic Expansion of Truck‑Stop Network
   CargoJet’s plan to add 200 new truck stops over the next three years will increase its capacity to handle more volume, reduce empty miles, and improve margins. The expansion will be financed through a mix of debt and equity, and the company has secured favorable terms with its lenders.

3. Improved Cost Structure
   The firm has implemented a fuel‑management program that has cut fuel expenses by 3% YoY. Additionally, automation of the booking platform has lowered administrative costs, raising EBITDA margins to 6% in 2023.

4. Potential M&A Opportunities
   CargoJet is actively scouting for smaller regional freight brokers that could be acquired to boost market share. A recent acquisition of a 30‑city broker in the Midwest would provide instant access to new contracts and an expanded customer base.

Risks and Uncertainties

Despite the upside, several risks loom:

• Tariff Policy Continuity – Continued or escalating tariffs could compress freight volumes, especially in cross‑border shipments.
• Fuel Price Volatility – Crude oil price swings will impact operating costs. The firm’s fuel hedging strategy covers only 60% of exposure.
• Competitive Pressure – Larger players may enter the niche parcel market, eroding CargoJet’s pricing power.
• Technology Disruption – Advances in autonomous trucking and blockchain logistics could alter the competitive landscape.

Valuation Assessment

At the time of writing, CargoJet trades at a forward P/E of 28x, compared to 19x for its largest peers. However, when adjusted for size and growth potential, the valuation sits at a premium but remains within range for a high‑growth logistics company. The 12‑month price target set by the Seeking Alpha contributor—$32—reflects an expectation of a 15% return on the current price.

Given the company’s steady revenue growth, improving margins, and strategic initiatives to capture e‑commerce freight, the stock appears undervalued relative to its peers and the industry’s long‑term trajectory.

Conclusion

CargoJet’s recent dip was largely a reaction to macro‑economic anxieties rather than a reflection of core operational performance. The company’s robust revenue growth, expanding service portfolio, and strategic initiatives to strengthen its network position it well to benefit from the ongoing shift towards digital freight solutions and e‑commerce logistics. While risks remain—particularly surrounding tariff policy and fuel costs—the current market mispricing offers a compelling entry point for investors looking for a foothold in the evolving freight brokerage sector.

By carefully monitoring the company’s quarterly results, fuel hedging efficacy, and the pace of its expansion plans, stakeholders can gauge whether CargoJet will rise to meet its growth targets or if the trade‑war panic will continue to weigh on its valuation. For now, the evidence suggests that CargoJet’s stock is a mispriced opportunity amid a broader market correction.