We hope everyone spent a wonderful day with family and enjoyed a hearty meal! With Thanksgiving behind us, it’s time to focus on the markets again.

Today we discuss the first of the two recent portfolio additions. We will take a look at XPO Logistics (NYSE: XPO) today and IQVIA Holdings (NYSE: IQV) in next week’s update.

As you may have guessed from its name, XPO is a global logistics company, with more than 50,000 customers and presence in more than 30 countries. The company provides services to help customers manage their goods efficiently throughout their supply chains. Most of its customers use multiple services offered by the company, a sign of service satisfaction, and bodes well for customer loyalty.

Thanks in particular to globalization and the fast growth of e-commerce (expected to see double-digit percent growth through at least 2020), the need to transport and deliver goods over varying distances is increasing quickly. XPO estimates that the addressable opportunity is $1 trillion, of which it only holds a market share of about 1.5 percent. This means that there could be a lot of room for further growth.

XPO’s services include freight brokerage, last mile, less-than-truckload, and global forwarding services. The company owns or leases about 16,000 tractors and 39,500 trailers. In addition, it has another 10,000 independent owner operators under contract to provide shipping services, and works with more than 50,000 independent brokered carriers. In total, XPO has something to do with more than 1 million trucks on the road right now.

XPO serves a wide array of industries, ranging from retail to food & beverage to health care to automotive and everything imaginable in between. The company holds either the number 1 or number 2 position in most of sub-segments of the logistics and transportation industry. Its main market is still the U.S., and France, the U.K., and Spain account for the next three largest.

Besides transportation, XPO also offers logistics services, which includes e-commerce fulfillment, order personalization, packaging and labeling, warehousing and distribution, and others. These services may not sound particularly exciting, but they are essential to businesses that have inventory and regularly ship anything.

Basically, XPO has a hand in all aspects of the logistics & transportation business.

Revenue nearly doubled between 2015 and 2016, primarily driven by two major acquisitions. But organic growth is no slouch either, accelerating to about 7.5 percent this year. Moreover, margins in both transportation and logistics have expanded. As integration of the major acquisitions continue, we think margins have further upside.

The company has established an EBITDA target of at least $1.365 billion for this year and at least $1.6 billion for next year, representing 17 percent growth in 2018. EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It is a metric often used by companies to measure operating performance.

XPO’s most recent quarter set numerous financial records, including revenue and profit. Free cash flow in the quarter grew to more than $183 million. According to XPO’s guidance, next year, free cash flow should increase to about $550 million.

This is a company running on all cylinders right now and favorable economic trends suggest that even better days are ahead. XPO has established itself as a leading integrated one-shop solution for logistics & transport services and will likely enjoy solid continuing growth. The biggest risk is if the world economy is beset by a major recession, and economic activity slows, but few companies are truly immune to recession.

Our initial suggest buy-up-to price for XPO is $85. Remember to click the “Portfolio” link on our website to get the most up-to-date recommendations.