Landstar’s stock price has taken a beating over the past six months, shedding 20.2% of its value and falling to a new 52-week low of $110.14 per share. This may have investors wondering how to approach the situation.

Is now the time to buy Landstar, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it’s free for active Edge members.

Why Do We Think Landstar Will Underperform?

Despite the more favorable entry price, we're swiping left on Landstar for now. Here are three reasons we avoid LSTR and a stock we'd rather own.

1. Long-Term Revenue Growth Disappoints

Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last five years, Landstar grew its sales at a tepid 4.6% compounded annual growth rate. This was below our standard for the industrials sector.

2. EPS Growth Has Stalled

We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.

Landstar’s flat EPS over the last five years was below its 4.6% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded.

3. New Investments Fail to Bear Fruit as ROIC Declines

ROIC, or return on invested capital, is a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity).

We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. Over the last few years, Landstar’s ROIC has unfortunately decreased significantly. We like what management has done in the past, but its declining returns are perhaps a symptom of fewer profitable growth opportunities.

Final Judgment

We see the value of companies helping their customers, but in the case of Landstar, we’re out. Following the recent decline, the stock trades at 27.8× forward P/E (or $110.14 per share). This multiple tells us a lot of good news is priced in - we think there are better stocks to buy right now. Let us point you toward one of our all-time favorite software stocks.

Stocks We Like More Than Landstar

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Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.