Just a few short months ago, fuel prices were soaring through the roof, and trucking companies were worried about their survival. Now that fuel prices have plunged, trucking companies are thriving, right?
Wrong, according to Lee Klaskow of Longbow Research.
"Actually, the decline in fuel has been a negative for the trucking industry as a whole," he told CNBC.
Run that by us again?
"What was happening was that there is a huge imbalance in demand and supply within trucking capacity," he explained. "Lower fuel costs are keeping a lot of trucking companies, that should have left the business in bankruptcies, on life support for a couple more months."
So he says the outlook isn't very bright for the industry, or for the shares of its companies: "These are early-cycle stocks. ...We're not even close for an upside in the overall economy."
But he has an idea for investing in trucking:
"For those looking for an early-cycle play, our favorite name within the space is Heartland (Express) ," he said. "We like it because it has zero debt on its balance sheet; it works in the short- to medium-haul trucking industry, which is more of a regional industry and is a little less cyclical than others out there."