C.H Robinson and Landstar stock prices slammed; insurance costs a factor

Strong financial numbers released between Tuesday and Wednesday by C.H. Robinson and Landstar were overshadowed on Wall Street by concern over one particular issue: insurance.

Landstar kicked off the issue Tuesday afternoon with its third quarter earnings release that showed heavier than usual insurance charges.

The C.H. Robinson (NASDAQ: CHRW) 3Q earnings, while not being as specific as the Landstar (NASDAQ: LSTR) report on the individual hits that drove up its insurance costs, did provide data that showed its insurance costs were abnormally high during the quarter.

Coming in a six-month period in which the broader long-term risk of insurance costs rising was driven home by expanded broker liability exposure due to Montgomery vs. Caribe Transport II, and a whopping nuclear verdict that hit C.H. Robinson in Lipe vs. Lupus Superior and its subsequent affirmation by a Dallas County judge, the insurance aspects of otherwise solid earnings appeared to lead investors to effectively nullify otherwise strong financial reports.

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