In a recent report, Goldman Sachs singled out some notable surprises among the companies that saw an uptick in hedge fund ownership.
As stocks that see increases in hedge fund ownership tend to perform well in their sectors, they are certainly worth keeping an eye on.
But what about Knight-Swift (NYSE: KNX)?
Is the transportation industry profitable?
Judging by Goldman Sachs reports, it appears that Wall Street has set its sights on Knight-Swift Transportation, the largest truckload carrier in the U.S.
Sure, the numbers are not bad, with analysts projecting an average price target of $49.20 for the next year — a 13.13% increase from the stock’s current price. But do they really warrant the bullish sentiment?
The answer may lie in Knight-Swift’s diversified operations.
Namely, the company provides truckload, less-than-truckload (LTL), logistics, and intermodal services, meaning it might capitalize on various segments of the freight market, as it tends to remain relatively stable during recession, which is on everyone’s lips these days, given the ongoing trade wars and tariff talks.
In 2024, the company also managed to recover from a -3.86% growth dip in 2023, being up by 3.76%. What’s more, it still maintains a 1.66 % annual dividend yield of $0.18 per share.
In other developments, Knight-Swift recently reported its Q1 2025 earnings, with Earnings Per Share (EPS) coming in at $0.28, just a cent shy of the $0.29 estimates.
The Q2 EPS guidance, however, was lowered to $0.30–$0.38 from the previously disclosed range of $0.46 to $0.50 due to uncertainties with the current fluid trade policy.
All things considered, Knight-Swift might indeed be a savvy pick given its strong foothold in an industry known for its resilience during economic slowdowns.
Another recession-reslient play
A lot of investors are not shy when it comes to Uber (NYSE: UBER) either.
Bill Ackman, for example, reportedly has a $2 billion stake in the mobility as a service (Maas) giant.
The sentiment is less surprising here, as Uber sees around 170 million active users each month, which has resulted in an 18% year-over-year (YoY) increase in trips and gross bookings in Q1 2025.
We ought not to forget that Uber has been working on forging new partnerships with autonomous vehicle (AV) manufacturers, which could allow it to benefit from growing AV adoption as well.
But just like Knight-Swift, Uber is often considered recession-resistant as rides and deliveries still enjoy some use during downturns, even when potential users are cutting back on other expenses.
Uber CEO Dara Khosrowshahi, at any rate, remains positive about the company’s health in light of the potential recession.
Uber could see a rise in new drivers if the economy slips into recession, Khosrowshahi argues, adding that if there is more unemployment, the cost of Uber will come down because the cost of labor comes down.
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