What exactly is "last-mile delivery"?

Last-mile delivery refers to the final step of the delivery process, where a product travels from a distribution center or transportation hub to its final destination (typically a customer's home or business). It's called the "last mile" even though the actual distance varies. This final leg is often the most expensive and complex part of shipping, accounting for up to 53% of total delivery costs, due to inefficiencies like multiple stops, traffic congestion, and failed delivery attempts.

Why is last-mile delivery considered a growth area?

Last-mile delivery is growing rapidly primarily because of the explosive rise in e-commerce. As more consumers shop online and expect faster deliveries (same-day or next-day), companies must invest heavily in optimizing this final delivery step. The COVID-19 pandemic accelerated this trend significantly. Additionally, technological innovations like route optimization software, automated fulfillment centers, and even drone delivery are creating new opportunities to solve these complex logistical challenges more efficiently.

What does "less-than-truckload" (LTL) mean?

Less-than-truckload (LTL) shipping refers to the transportation of relatively small freight that doesn't require the entire space of a full truck. Instead of dedicating an entire truck to one shipment, LTL carriers combine multiple shipments from various customers on a single truck. This makes shipping more cost-effective for businesses that don't have enough goods to fill an entire truck. Several companies in this stock group (like ODFL and SAIA) specialize in LTL services, which are an important part of the supply chain that leads to last-mile delivery.

How do dividend yields relate to these delivery stocks?

Dividend yield represents the annual dividend payment divided by the stock's current price, expressed as a percentage. For delivery and logistics companies, dividend policies vary widely. More established players like UPS and FDX often pay regular dividends, reflecting their stable cash flows, while growth-focused newer entrants might reinvest profits instead of paying dividends. When considering these stocks, dividend yield is one factor that can indicate a company's maturity and management's confidence in stable future cash flows.

What are the main risks associated with investing in last-mile delivery stocks?

Key risks include intense competition (both from established players and new entrants like Amazon developing their own delivery networks), rising fuel and labor costs which can squeeze margins, regulatory challenges around emissions and worker classification, and technological disruption from innovations like autonomous vehicles or drone delivery. Additionally, last-mile delivery companies are sensitive to economic cycles, as consumer spending impacts shipping volumes, and to seasonal fluctuations (with peaks during holiday seasons).

14 handpicked stocks

Last-Mile Delivery

Tap into the companies mastering the final step of e-commerce. These carefully selected stocks represent businesses solving the complex challenge of getting products from distribution centers to customers' doorsteps, a critical growth frontier in our digital economy.

Han Tan | Market Analyst

Published on June 17

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

United Parcel Service, Inc.

UPS

Current price

$86.12

A global logistics leader heavily investing in technology to optimize its extensive last-mile delivery network.

FedEx Corporation

FDX

Current price

$242.32

A primary competitor in global parcel delivery, essential for business and residential last-mile services.

DoorDash

DASH

Current price

$270.09

A leader in the on-demand local delivery market, expanding from food to a wide range of retail goods.

GXO Logistics, Inc.

GXO

Current price

$53.63

XPO Inc.

XPO

Current price

$126.84

Ryder System, Inc.

Current price

$190.47

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12 Month Growth Potential

Use the growth calculator to see how much investing in these assets could return over one year, based on aggregated analyst sentiment provided by Refinitive Ltd.

If you invested across these assets:

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In 12 months it might be worth:

$1,000.00

+37.21%

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About This Group of Stocks

Our Expert Thinking

We've focused on companies that excel at the most costly and complex phase of e-commerce: the journey from distribution hub to customer doorstep. As online shopping continues its unstoppable growth, these businesses are positioned to benefit from the increasing demand for faster, more reliable delivery solutions.

What You Need to Know

This portfolio offers targeted exposure to a high-growth segment of the digital economy. It includes global logistics leaders, specialized carriers for heavy goods, tech platforms connecting delivery networks, and innovators in route optimization and fulfillment automation.

Why These Stocks

These companies were selected for their strategic positions in solving the last-mile puzzle. The mix includes established delivery giants, specialized freight carriers, and logistics technology platforms - all benefiting from consumers' ever-rising expectations for same-day or next-day shipping.

Group Performance Snapshot

37.21%

Average 12 Month Profit

On average, analysts expect assets in this group to grow 37.21% over the next year.

10 of 14

Stocks Rated Buy by Analysts

10 of 14 assets in this group are rated Buy by professional analysts.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

🚚

The E-Commerce Backbone

As online shopping continues its explosive growth, these companies power the crucial final step that brings products to your door. Without them, the digital economy simply couldn't function.

🔥

The Same-Day Revolution

Consumer expectations for lightning-fast delivery keep rising, and these companies are the ones making it happen. The race for speed creates continuous growth opportunities for last-mile innovators.

🤖

Tech-Powered Efficiency

These companies aren't just moving packages—they're developing AI route optimization, automated fulfillment, and drone delivery. They're solving the most complex logistics challenge with cutting-edge technology.

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