Morgan Stanley has moved Saia Inc. (NASDAQ: SAIA) off its Equalweight list and into an Underweight designation, putting a $250.00 price target on the less-than-truckload carrier - a valuation markedly below the stock's most recent quote of $390.47.
The downgrading followed Saia's fourth-quarter financial report, which Morgan Stanley characterized as a "modest miss." Management issued guidance the firm described as "relatively optimistic" for the first quarter, but analysts at Morgan Stanley concluded that the company’s quarterly disclosure was not strong enough to justify the current share price.
In its note, Morgan Stanley indicated it did not expect consensus estimates to move meaningfully in reaction to the quarterly release. Instead, the bank focused on valuation metrics and the disconnect between the company’s diminished earnings trajectory and its market valuation.
Morgan Stanley emphasized that Saia’s stock has again traded above $400 per share even though the firm says earnings estimates for the company have been "nearly halved over the past year." Supporting that view, InvestingPro data cited by Morgan Stanley shows Saia changing hands at a price-to-earnings ratio of 37.04 and trading above its calculated Fair Value.
The bank further estimated Saia will trade at roughly 40 times projected fiscal year 2026 earnings, concluding that the risk-reward profile appears "skewed to the downside, even in an upcycle." The equity’s recent market behavior - including a beta of 2.08 and a one-week return of 9.44% - reinforced concerns about volatility and valuation in Morgan Stanley’s assessment.
Saia’s published fourth-quarter results showed mixed outcomes. The company reported earnings per share of $1.77, missing the consensus estimate of $1.90. Management said the shortfall reflected $4.7 million of adverse prior period accident claims development, which reduced EPS by $0.14. Revenues, however, came in at $790 million versus expectation of $775.64 million.
The earnings shortfall prompted at least one other analyst to adjust expectations; Stifel trimmed its price target to $364 from $371 while keeping a Hold rating. Those moves reflect investor caution around Saia amid the recent financial update and the valuation questions flagged by Morgan Stanley.
Note: Where available data is limited, this article reflects only the information provided in the company disclosures and analyst notes referenced above.