2023 brought markets a year full of swings, both emotional and financial, driven by the fears of a coming recession (which was never realized) and a FED that turned hawkish and began raising interest rates aggressively; today's bull market is sponsored by a second consecutive quarter of real GDP growth for the U.S.

Today, those indecisive swings in the market end, as the FED is now hinting at six potential interest rate cuts coming in 2024, making a clear path for investment dollars to start moving into a particular space of the economy before any other. Keep this in mind as you read on: your stuff still needs to get where it's going.

This reason is only the beginning of the case that is now building in favor of stocks like XPO (NYSE: XPO) and others in the transportation sector. No matter how solid or brief the new direction the FED has taken, these stocks are partly immune to the underlying business cycle.

Agreeing on one thing 

Just as any respectable investor (like you) would start analyzing a potential stock to add to a watchlist, it would be wise to compare XPO stock to other competitors like Saia (NASDAQ: SAIA) and J.B. Hunt Transport Services (NASDAQ: JBHT) and see where they all stand in the industry.

You should read this if you want to add upside to your portfolio in the coming months. Analysts at J.P. Morgan Chase & Co. (NYSE: JPM) and Citigroup (NYSE: C) all have realized what is coming to this sector, especially for its crowned jewel... Which is XPO.

As interest rates come down and money thus becomes cheaper, businesses and consumers will start upping their consumption and spending. Because XPO has a growing collaboration with E-commerce platforms like Shopify (NYSE: SHOP), they also get a share of the upside of renewed consumer activity.

Even without this tapped royalty into small business growth and consumer activity, XPO is still considered a safe stock to be in because your stuff still needs to get to where it's going. A recession or a booming economy is not going to change that fact.

These analysts surely understand these trends and fundamental factors, but what is the price target? J.P. Morgan analysts see a $97.0 target, or 10.0% above today's prices. Citigroup took a slightly more bullish stance at a $100.0 a share target; that's 13.0% higher, by the way!

Commitment check 

So look, analysts are raising their price targets on XPO and are likely to continue raising them. However, analyst targets should be taken with a grain of salt, as they are usually looking to save face and not take too many risks with their opinions. 

Markets have a much heavier vote weight on where stocks will be headed, so a good way to double-check analyst sentiment is to gauge where the market as a whole stands regarding XPO, and especially with its competitors.

Starting with the most straightforward language the market chooses to speak to investors through, price action, XPO stands out beautifully. On a year-to-date basis, XPO stock rose by 176.7%, outperforming Saia by 60.1% and J.B. Hunt by as much as 159.8%. Enough said there.

What could be causing this stampede of buyers to not only come into XPO but also to remain invested in it? Because a stock's value is typically determined by its underlying earnings, why don't you start there?

Realizing that XPO analysts projected a 24.0% growth in earnings per share for the next twelve months could help explain its massive outperformance against J.B. Hunt stock since analysts only projected 15.4% growth in that stock's EPS.

Last but not least, Saia analysts came in with a competitively close 21.2% projection in EPS growth. However, with 2024, where all that matters is growth, even a slightly higher projection for XPO could be enough to keep investment dollars in that stock longer.

Suppose you fear the upside has been squeezed out of the sector, even with the recent analyst target boosts. In that case, it should comfort you that, according to the latest employment situation reports, the truck transportation industry added 700 new jobs in the past month.

Because XPO is not only tied to trucking, you can also count on the 4.1 thousand jobs added to air transportation industries, reinstating the fact that the space is preparing for a coming spur in activity. If these trends prove correct, you know where markets stand and which stock they picked.