Q: " AI-focused logistics firm Algorhythm Holdings said its SemiCab unit boosted customers' freight volumes by 300%-400% "without ‌a corresponding increase in operational headcount."
The above AI powered logistics tool news caused a havoc among most Trucking and Logistics stocks resulting a drop of 10-20 %, in Thursday's trade, giving back all gains of last few weeks. Dow Jones Transportation Index was down 4%, today.
Do you see this as a long term threat to the sector ?
I am curious to have your take on whether this news/AI scare could impact rail stocks also, in any way.
We were planning to initiate a position in CNR, but not sure, if the move warrants a caution in near term.
Thank You
The above AI powered logistics tool news caused a havoc among most Trucking and Logistics stocks resulting a drop of 10-20 %, in Thursday's trade, giving back all gains of last few weeks. Dow Jones Transportation Index was down 4%, today.
Do you see this as a long term threat to the sector ?
I am curious to have your take on whether this news/AI scare could impact rail stocks also, in any way.
We were planning to initiate a position in CNR, but not sure, if the move warrants a caution in near term.
Thank You
5i Research Answer:
This is the state of the markets right now. RIME is a $6M company that made an announcement showing improved productivity, and it wiped out $400 billion in market value elsewhere. Even if 300% productivity gains could be sustained, companies like CNR will only benefit. Logistics software companies might be threatened, but the actual delivering companies should see lower costs and lower margins. RIME's claims haven't even been independently verified. Certainly there are going to be AI developments in logistics and transportation over time. But we do not think this promotional press release from a tiny company is going to kill the sector. The decline makes us more interested in CNR stock.