Highlights

  • Covenant Logistics reported third-quarter 2026 diluted Earnings of US$0.40 per share and adjusted earnings of US$0.50 per share.
  • Combined Truckload Revenue rose 2.5% to US$204.6 million, while the average fleet size shrank 8.9% year over year.
  • Managed Freight freight revenue climbed 68.4%, mainly reflecting Assets the company acquired during the fourth quarter of 2025.
  • Net indebtedness fell US$12.4 million from the 2025 year end to about US$283.9 million at 30 September 2026.

Customer rate increases secured in the first half of 2026 began to show up in earnings for Covenant Logistics Group, Inc. (NYSE:CVLG) in the three months to 30 September 2026. The Chattanooga, Tennessee-based transportation and logistics group reported GAAP diluted earnings of US$0.40 per share and non-GAAP adjusted earnings of US$0.50 per share for Q3 2026, released on 29 October 2026.

Management said it was the first quarter since Q2 2022 in which adjusted Earnings Per Share improved both sequentially and against the prior-year period. It linked the Margin improvement to those rate increases and to lower purchased transportation costs as spot rates eased, following three quarters of margin compression.

Smaller Truckload Fleet Earns More Per Tractor

Combined Truckload revenue rose 2.5% to US$204.6 million. Fuel Surcharge revenue increased by US$10.8 million, while freight revenue declined by US$5.8 million as the average fleet contracted 8.9%.

In Expedited, freight revenue fell 12.0%, or US$9.6 million, as the average tractor count dropped from 861 to 677. Freight revenue per tractor per week rose 12.0%, and about 58% of Expedited tractors operated under committed capacity agreements, compared with roughly 40% three months earlier.

Dedicated freight revenue grew 4.2%, or US$3.8 million, on a slightly smaller average fleet of 1,509 tractors. Revenue per tractor per week increased 6.2%, which the company attributed to growth in agricultural protein Business and its exit from non-specialized dedicated work.

Managed Freight, Warehousing and TEL Contributions

Managed Freight freight revenue jumped 68.4% year over year, driven mainly by assets acquired in Q4 2025, although management flagged rising insurance and claims expense as a growing risk.

Warehousing freight revenue rose US$1.9 million, largely from a significant customer onboarded in Q4 2025, although segment Operating Income was below the prior year because of inefficiencies at new customer sites and labor inflation. The company's 49% Equity Investment in Transport Enterprise Leasing produced pre-tax Net Income of US$5.7 million, or US$0.16 per share, up from US$3.6 million a year earlier.

Fourth-Quarter Outlook and Capital Plans

Management expects a modest sequential increase in earnings per share in Q4 2026, with improving asset-based margins partly offset by lower income from Transport Enterprise Leasing. It anticipates Dedicated fleet growth and a stable Expedited fleet with more capacity under committed contracts.

About 80% of fleet assets were under long-term contracts at quarter end, and the company aims to place substantially all asset-based business under long-term dedicated or committed contracts by the end of the freight upcycle. Net Capital Expenditure was about US$18.4 million for the first nine months, and the company expects US$35.0 million to US$40.0 million for the rest of 2026.