GXO Logistics, Inc. (GXO)
Valuation Overview•Is GXO Logistics, Inc. Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Fragile underlying quality score of 26/100; weak margins or elevated debt leverage warrant caution.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Highly distressed profile flashing severe fundamental warning signs.
Wall Street is highly bullish, projecting significant upside alongside robust expected earnings growth. This is paired with healthy capital returns, driven predominantly by aggressive share repurchases.
Returns capital exclusively via buybacks — no active dividend
GXO struggles with subpar profitability and pressured margins. However, this is severely offset by a highly leveraged balance sheet (Debt/EBITDA > 4.0x) and elevated financial risk.
The company demonstrates solid revenue growth (13.6% 3Y CAGR) however, earnings have severely contracted over the same period. However, profitability remains a major concern with severely compressed operating margins (3.1%).
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $3.3B | +12.5% | +13.6% | +16.3% | — | |
| EBITDA | $194.0M | — | +15.6% | — | — | |
| Net Income | $29K | -76.1% | -45.4% | — | — | |
| EPS (Diluted) | $0.03 | -75.0% | -44.9% | — | — | |
| Free Cash Flow | -$34K | -99.9% | -91.8% | -74.9% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 12.7% | 12.7% | 12.8% | 12.3% |
| Operating Margin | 3.1% | 2.8% | 2.6% | 2.2% |
| Net Margin | 0.9% | 1.2% | 1.6% | 1.2% |
| FCF Margin | 3.2% | 1.5% | 1.9% | 1.4% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.37 | $0.50 | +35.1% | ||
| Q1'26 | $0.83 | $0.87 | +4.8% | ||
| Q4'25 | $0.78 | $0.79 | +1.3% | ||
| Q3'25 | $0.56 | $0.57 | +1.8% | ||
| Q2'25 | $0.26 | $0.29 | +11.5% | ||
| Q1'25 | $0.94 | $1.00 | +6.4% | ||
| Q4'24 | $0.78 | $0.79 | +1.3% | ||
| Q3'24 | $0.57 | $0.55 | -3.5% |
Total return is +13.7% (1Y), lagging the benchmark by -11.3%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | -10.4% | -19.7% | — |
| 1Y | +13.7% | -11.3% | — |
| 3YCAGR | -6.7% | -26.6% | — |
| 5YCAGR | -2.2% | -14.9% | — |
| 10YCAGR | -1.1% | -14.9% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about GXO Logistics, Inc. (GXO) valuation, health, and returns.
GXO Logistics, Inc. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. undervalued (implying +63.3% upside to DCF intrinsic value of $79.43)
GXO Logistics, Inc. has multiple valuation anchors: DCF Intrinsic Value: $79.43 | Peer Relative Fair Value: $73.24 | Wall Street Analyst Target: $71.25 (implying +46.5% upside). A convergence of these signals offers higher conviction.
GXO Logistics, Inc. displays weak financial health with a composite quality score of 26/100, supported by a Altman Z-Score of 1.1 (distress zone), Piotroski F-Score of 5/9, Return on Invested Capital (ROIC) of 3.6%.
GXO Logistics, Inc. returns capital via buybacks instead of dividends, carrying a 3.6% buyback yield and reducing outstanding shares by -2.9% in the last 12 months.
GXO Logistics, Inc.'s current growth trajectory is Stable. The company achieved +12.5% 1Y revenue growth and -75.0% 1Y EPS growth, compared to its 3Y revenue CAGR of +13.6%.
Wall Street consensus is Buy based on 18 analysts, beating EPS expectations in 83% of recent quarters with a 7-quarter streak. The consensus price target represents a +46.5% change from current levels.
Investment risks for GXO Logistics, Inc. include: -30.6% 1-year max drawdown, high beta (1.58x market volatility), elevated distress risk. Volatility risk is characterized by a beta of 1.58x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.