What Happened?
Shares of contract logistics company GXO (NYSE: GXO) jumped 3.1% in the afternoon session after the stock's positive momentum continued as the company reached a two-year pay agreement with its drivers in Motherwell, ending a period of labor disputes. The union Unite confirmed it secured a significant pay win for the drivers, who deliver supplies for major companies including Costco and Superdrug. The deal included a 5% increase in basic pay, backdated to April, and another 4% increase from the start of 2026 until the end of March 2027. This resolution followed strike action and an overtime ban by GXO drivers in early November as they sought a better wage offer. The agreement appeared to boost investor confidence by ensuring operational stability.
After the initial pop the shares cooled down to $52.39, up 2.8% from previous close.
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What Is The Market Telling Us
GXO Logistics’s shares are somewhat volatile and have had 11 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 10 months ago when the stock dropped 15.8% on the news that the company reported weak fourth quarter results. Its full-year EPS and EBITDA guidance fell short of Wall Street's estimates. In addition, while GXO Logistics narrowly topped analysts' revenue expectations this quarter, its organic revenue missed. Overall, this was a weaker quarter.
GXO Logistics is up 21.6% since the beginning of the year, but at $52.39 per share, it is still trading 11.2% below its 52-week high of $59 from December 2024. Investors who bought $1,000 worth of GXO Logistics’s shares at the IPO in July 2021 would now be looking at an investment worth $961.23.
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