Markets & Finance

Bear Stearns Ups Landstar System Opinion

Bear Stearns upped its investment opinion on Landstar System (LSTR) to outperform from peer perform.

Analyst Edward Wolfe said the company Thursday filed an 8-K noting that it modified its 2005 disaster-relief contract with the Department of Transportation, raising the cap to a potential $400 million in revenue; also, the company announced a new contract for 2006, capped at $100 million. Further, the company said it had thus far booked $22 million in Dennis revenue in the third quarter 2005. The analyst says the 8-K provides him greater visibility on: 1) Landstar's potential amount of Katrina-related relief revenue, 2) the duration of potential disaster-relief revenue. Accordingly, the analyst upped his $1.56 2005 earnings per share estimate to $1.64, $1.77 2006 to $1.83. He maintained his $45 year-end 2006 target.

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