There’s some low single-digit rate increases to be had, and those conversations really have not been that hard. The harder ones are some people coming in here wanting, they start throwing out numbers. I want another 10% off, and there’s not another 10% to give. And so I think you’re going to start seeing small truckers, medium-sized truckers, big truckers, people start pulling those numbers around. They’re going to take it and reprice it as soon as they can, or there is not going to take it and folks will sit some trucks against the fence. So I think we’re at the bottom. And I think the real partner shippers, the real sophisticated folks know, hey, if I can get this thing for breakeven to 1% or 2%, then they’re not going to come in here and reprice me, and we’ll have another pricing discussion this time next year.
And they just want to move on with business.
Scott Group: Okay. But it sounds like some of like the vanilla dry van stuff is still seeing some downward pressure.
Tripp Grant: It is. The really, really commoditized stuff is still seeing a little bit of downward pressure. As you know, Scott, that’s not a lot of our business. But in the pieces of it, we have, yes.
Scott Group: Right, right. Your comment about earnings lower in Q1. Was that a year-over-year comment, a sequential comment? I just want to make sure I’m understanding?
David Parker: It was a sequential comment. I mean, no doubt they’re going to be lower than Q4. I think analyst consensus right now is lower than prior year quarter. And I think where we fall out in Q1, quite frankly, is going to be a function of weather. And if we have any more — a bunch more what we had last week, it’s going to put some pressure on it. And then really how much inefficiencies are in these startups, because I mean we’re starting up 100 to 150 trucks, dependent on someone get accelerated, it could be more than that in the first quarter on Dedicated, and you won’t see all those in the truck count because it’s kind of weighted. Some of those are February, March start-ups, but how much inefficiency do we have, especially in a winter season getting the pump primed and getting those things running out there.
With our low share count, as you know, it doesn’t take much to make it go up, but it doesn’t take much to pull it back. So, I think, once we get through this quarter and get those start-ups digested and get them on plane, we’ll have a lot better feel of where we’re going to be. But here a thing — we’re excited about first quarter. I mean, there’s nobody here hanging their head, but I think we’re going to be excited.
Scott Group: Okay. And then just overall, when you — I know it’s early, but when you think about the full year, do you think you’re likely to grow earnings or not this year? And then maybe when you think about the different segments, which ones are best positioned to grow earnings? And where maybe do you see another step back in earnings, if anywhere?
Tripp Grant: Yes. I mean, I think, expedited — I think, expedited earnings is probably about the same, maybe backwards or higher depending on the governmental business. Some of that governmental business took a step back in the fourth quarter and that’s a volatile piece of business. So we’ll see how that goes. But I see expedited back maybe a little, but it’s all dependent on the governmental dedicated forward because that’s — we talked about a lot of the growth that we’ve already got in the pipeline and starting up managed freight. Again, as you know, that’s our exposure to the one-way market. Managed freight is probably moving back a little bit and warehousing is moving forward.
David Parker: I think managed freight could improve. We’ll have a full year effect of the Sam’s [ph] acquisition.
Tripp Grant: That’s true.
David Parker: We took a couple of big hits that we’ve kind of had to absorb in Q1. We didn’t call it out as a GAAP to non-GAAP adjustment or anything like that because it’s part of the game, but they were a material hit in Q1, I would say, with some theft. And what I would say is I think that the team and the combination of the team and the acquisition and the improvement in the freight market could give us a little bit of an improvement and managed freight year-over-year 23 — or 2024 compared to 2023. And then I would also say warehousing — warehousing as small as it is, has a lot of really positive momentum that we’re seeing, and I think that will continue.
Tripp Grant: Warehousing’s best two months of the last three years November and December of 2023.
Scott Group: Okay. So hopefully, three of the four businesses with some earnings growth?
Tripp Grant: Yes.
Scott Group: Very helpful. Thank you, guys.
Tripp Grant: Thanks.
David Parker: Thanks, Scott.
Operator: Our next question comes from Jack Atkins from Stephens. Please state your question.
Jack Atkins: Okay. Great. Good morning, guys and thanks for the time. So I guess maybe kind of taking a step back and Paul, I think your comments around just — I guess the position shippers are taking going through bid season is really kind of interesting. I mean do you think that that’s because that they’re anticipating a change in market dynamics as we move through this year. I would just be kind of curious to get just to take — that you guys might have on how close we are to maybe starting to see fundamentals begin to improve. Do you think enough capacity has come out to maybe set the stage for that, or is there more than needs to sort of exit here over the next six months?
Paul Bunn: I mean I think more exits are going to help, and they’re continuing to happen. And again, Jack, I’ll just reiterate the folks who want a 12-month deal and they don’t want to be monkeying with this thing and a bunch of back and forth because they’re focused on running their business. They’re — it’s a pretty easy discussion in the low single digits right now. Folks that are big commoditized shippers that are just trying to squeeze every penny out of it and do a bunch of mini bids and all that kind of stuff. You know, they’re the ones that are still pushing for lower. And so I think what you’re saying is, yes, you can read something into that is that I think the fundamentals are starting to slightly change, but nobody is getting crazy with it.
