As industrial activities gain pace with the recovery of major economies, the transportation services market is witnessing a significant surge in demand for cross-border services. Also, because freight demand remains high, we believe transportation companies United Parcel (UPS), Union Pacific (UNP), and J.B Hunt (JBHT) could be solid picks now because they are well-positioned to capitalize on the industry tailwinds and are currently trading below their 52-week highs. So read on for a closer evaluation of these names.Because many industries have resumed operating at close to full capacity on the recovery of economies, the transportation services market is experiencing a substantial upsurge in demand for cross-border services. In addition, because consumers continue to rely heavily on online shopping, freight demand has risen dramatically in recent months, surpassing the trucking industry's capacity to recruit new drivers and buy new equipment.
Rapid technological advancements, growing urbanization, and e-commerce expansion are anticipated to be the transportation industry’s major growth drivers. Consequently, the global transportation market is expected to hit $7.8 trillion by 2027, representing a 3.4% CAGR.
Therefore, we think the recent share-price price dips in fundamentally sound transportation companies United Parcel Service Inc. (NYSE:UPS), Union Pacific Corporation (NYSE:UNP), and J.B Hunt Transportation Services Inc. (JBHT) provide good entry opportunities.