Citigroup Downgrades XPO Stock Rating to "Neutral" with Raised Price Target to $140.00

Citigroup has downgraded XPO's stock rating from "Buy" to "Neutral" while raising its price target from $137 to $140. Despite the downgrade, the analyst still sees potential for stock price growth. Based on 24 analysts' one-year price targets, the average target price for XPO Inc is $132.58, with a high estimate of $152 and a low estimate of $85. The average target implies an upside of 0.24% from the current price of $132.26.

Citigroup has downgraded XPO (NYSE:XPO) from a "Buy" rating to "Neutral," while raising its price target from $137 to $140. Despite the downgrade, the analyst sees potential for stock price growth. Citigroup's target price would indicate a potential upside of 5.76% from the company's current price of $132.26.

The downgrade reflects Citi’s view that XPO’s "elevated valuation could limit further upside without a meaningful acceleration in 2026 EPS estimates" [1]. This assessment aligns with InvestingPro data showing XPO trading at a P/E ratio of 39.56, suggesting a relatively high earnings multiple. Citi acknowledged that XPO has been executing well relative to peers and has unlocked "structural operating improvements" expected to persist when macroeconomic conditions eventually change [1].

Several other analysts have also weighed in on XPO. Susquehanna raised their price objective on shares of XPO from $138.00 to $145.00 and gave the company a "positive" rating [3]. TD Cowen cut their price target on shares of XPO from $136.00 to $133.00 and set a "buy" rating on the stock [3]. Stifel Nicolaus cut their target price on shares of XPO from $147.00 to $142.00 and set a "buy" rating on the stock [3]. Stephens reaffirmed an "overweight" rating and set a $131.00 target price on shares of XPO [3].

Based on 24 analysts' one-year price targets, the average target price for XPO Inc is $132.58, with a high estimate of $152 and a low estimate of $85 [2]. The average target implies an upside of 0.24% from the current price of $132.26.

XPO has been the focus of several analyst assessments and operational updates. Oppenheimer raised its price target for XPO to $150, maintaining an Outperform rating, citing expected improvements in the company’s adjusted operating ratio through 2025, driven by pricing enhancements and operational efficiencies [1]. Meanwhile, TD Cowen adjusted its price target to $133 from $136, reflecting economic trends and projecting a slight decrease in second-half earnings estimates, although the firm continues to hold a Buy rating [1]. BMO Capital reiterated its Outperform rating with a $140 price target, expressing confidence in XPO’s strategic execution and long-term valuation potential [1]. Benchmark analysts also maintained a Buy rating with a $130 target, highlighting the company’s focus on pricing strategy to improve its operating ratio [1].

XPO reported a decline in its less-than-truckload (LTL) freight metrics for May 2025, with a 5.7% decrease in daily tonnage compared to the previous year, attributed to fewer daily shipments and reduced weight per shipment. Despite these challenges, XPO continues to implement cost and revenue initiatives to support growth. The company has cautioned that preliminary figures may not fully represent future performance, emphasizing the potential for variability due to economic and regulatory factors [1].

XPO declared that its board has authorized a share repurchase plan that allows the company to repurchase $750.00 million in outstanding shares. This repurchase authorization allows the transportation company to repurchase up to 5.7% of its shares through open market purchases. Shares repurchase plans are typically a sign that the company's management believes its shares are undervalued [2].

References:
[1] https://www.investing.com/news/analyst-ratings/citi-downgrades-xpo-stock-to-neutral-citing-valuation-concerns-93CH-4127794
[2] https://www.marketbeat.com/instant-alerts/filing-kbc-group-nv-has-541000-position-in-xpo-inc-nysexpo-2025-07-05/
[3] https://www.marketbeat.com/instant-alerts/xpo-nysexpo-stock-rating-lowered-by-citigroup-2025-07-09/