Radiant Logistics (RLGT) Stock: Why The Price Surged Today

By Amit Chowdhry ● Feb 15, 2022
  • The stock price of Radiant Logistics Inc (NYSEAMERICAN: RLGT) increased by over 14% during intraday trading today. This is why it happened.

The stock price of Radiant Logistics Inc (NYSEAMERICAN: RLGT) increased by over 14% during intraday trading today. Investors are responding positively to the company’s financial results for the 3 months ended December 31.

These are the highlights:

– Revenues increased to $332.8 million for the second fiscal quarter ended December 31, 2021, up $114.0 million or 52.1%, compared to revenues of $218.8 million for the comparable prior-year period.

– Net revenues, a non-GAAP financial measure, increased to $71.6 million for the second fiscal quarter ended December 31, 2021, up $16.3 million or 29.5%, compared to net revenues of $55.3 million for the comparable prior-year period.

– Net income attributable to Radiant Logistics, Inc. increased to $6.9 million, or $0.14 per basic and fully diluted share, up $3.1 million or 81.6% compared to $3.8 million, or $0.08 per basic and $0.07 per fully diluted share for the comparable prior-year period.

Adjusted net income, a non-GAAP financial measure, increased to $12.3 million, or $0.25 per basic and $0.24 per fully diluted share for the second fiscal quarter ended December 31, 2021, up $3.7 million or 43.0%, compared to adjusted net income of $8.6 million, or $0.17 per basic and fully diluted share for the comparable prior-year period. Adjusted net income is calculated by applying a normalized tax rate of 24.5% and excluding other items not considered part of regular operating activities.

Adjusted EBITDA, a non-GAAP financial measure, increased to $17.3 million for the second fiscal quarter ended December 31, 2021, up $4.8 million or 38.4%, compared to adjusted EBITDA of $12.5 million for the comparable prior-year period.

– Adjusted EBITDA margin (Adjusted EBITDA expressed as a percentage of net revenues), a non-GAAP financial measure, increased to 24.1% for the second fiscal quarter ended December 31, 2021, up 140 basis points, compared to Adjusted EBITDA margin of 22.7% for the comparable prior-year period.

On December 6, 2021, the company had announced that it acquired Navegate, a Minnesota-based, privately held company with offices that combines its robust digital platform and team’s expertise to manage international, cross-border, and domestic freight from purchase order to final delivery. And the transaction is valued at $35 million, subject to certain hold-back provisions and working capital adjustments as of the closing date.

Based on historic financial statements provided by its management, Navegate generated approximately $6.7 million in adjusted EBITDA on approximately $87.5 million in revenues for the twelve months ended September 30, 2021.

The company also purchased 870,733 shares of its common stock at an average cost of $7.18 per share for an aggregate cost of $6.3 million during the six months ended December 31, 2021. And as of February 1, 2022, the company had 49,443,305 shares outstanding.

KEY QUOTES:

“We are very pleased to continue our trend and report another quarter of record financial results for the December quarter,” said Bohn Crain, Founder and CEO of Radiant Logistics. “We posted record revenues of $332.8 million, up $114.0 million or 52.1%; record net revenues of $71.6 million, up $16.3 million or 29.5%; record net income attributable to Radiant Logistics, Inc. of $6.9 million, up $3.1 million or 81.6%; record adjusted net income of $12.3 million, up $3.7 million or 43.0%, and record adjusted EBITDA of $17.3 million, up $4.8 million or 38.4%. In addition, we also saw improvement in our adjusted EBITDA margin, which increased 140 basis points to a record 24.1% up from 22.7% for the comparable prior year period. These results reflect the benefit of our scalable non-asset based business model, diversity of our service offerings, and our ability to quickly respond to changing market dynamics and support our customers in this capacity constrained market. In addition, we delivered these record results while working through the challenges presented by our previous disclosed ransomware event that occurred on December 8th. Also note that these record results reflect only a one-month contribution from Navegate given the fact that we did not complete that transaction until November 30.”

“With offices in Mendota Heights, Minnesota (Twin Cities), Addison, Illinois (Chicago) and Shanghai, China, the Navegate platform itself represents an exciting new opportunity for the Radiant network and the end customers that we serve. In addition to solidifying our presence in Shanghai, Navegate also strengthens our international services offering, particularly in the areas of customs brokerage, ocean forwarding and drayage services and brings with it a proprietary technology platform to facilitate global trade management. These new global trade management capabilities will be made available to the entire Radiant network to provide our customers with purchase order and vendor management tools that unlock SKU-level visibility from the manufacturing floor in Asia through final delivery here in the U.S. With both the enhanced service offerings and propriety global trade management technology, we believe we will further differentiate ourselves in the marketplace and be even better positioned to provide additional support for both current and prospective customers.”

“In addition to progress on the acquisition front, we also continued to put capital to work in our stock buy-back program and have now purchased $6.3 million in stock through the six months ended December 31, 2021. As we have previously discussed, we believe that our current share price does not accurately reflect Radiant’s intrinsic value or long-term growth prospects, and we expect to continue to deploy our capital through a combination of strategic acquisitions and our stock buy-back.”

“It is worth pointing out that the record results we have delivered over each of these last several quarters have been fueled almost exclusively by organic growth. Looking forward, we remain optimistic about our prospects and opportunities to continue to leverage our best-in-class technology, robust North American footprint and extensive global network of service partners to continue to build on the great platform we have built here at Radiant. At the same time, we have begun to thoughtfully re-lever our balance sheet and through a combination of strategic acquisition and stock buy-backs we believe we are creating meaningful intrinsic value for shareholders that has yet to be recognized in our stock price.”

— CEO Bohn Crain

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.