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Transport Topics | Aggressive Acquisitions Fed Roadrunner Woes

02.07.17 | Rick Romell, Transport Topics

Not long ago, Roadrunner Transportation Systems was speeding down the growth highway. Now, the Cudahybased trucking and logistics firm seems to be hitting pothole after pothole.

After falling far short of its own earnings projections in one quarter and seeing profits plunge sharply in another, Roadrunner now must restate nearly two years’ worth of financial results, lowering previously reported earnings.

Roadrunner ranks No. 16 on the Transport Topics Top 100 list of the largest U.S. and Canadian forhire carriers.

The effects of these problems on Roadrunner’s stock have been dramatic. In mid2015, it traded above $25. Since then, it has lost about twothirds of its value. Shares closed Feb. 1 at $7.92, down $3.62, or 31%.

Noël Perry agreed. A partner at FTR Transportation Intelligence, a consulting and research firm in Bloomington, Indiana, Perry stressed that he does not know Roadrunner’s management. But he said many acquisitionminded executives focus on the acquisition process and “spend all their time worrying about it, not about running the business.”

As companies grow, they inevitably hit a threshold where the old management style no longer works, Perry said. “It’s quite possible that Roadrunner has run into this problem,” he said.

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