Morningstar analyst Nachi Moghe says conditions in Europe for Mainfreight are likely to continue to be challenging.
Mr Moghe said rationalisation and cost cutting is likely to improve earnings this year but, given the prevailing weak economic conditions engulfing most of Europe, he is factoring in any growth for 2014.
Last week, Mainfreight reported a 3% rise in annual net profit to $68 million. However, operating earnings fell 0.5% to $137 million, dragged down by a 43% fall in earnings in Europe.
As well as the ongoing weak economic conditions, Mainfreight lost some key high-margin customers in Europe.
Mr Moghe said the freight handing company's shares are fairly priced at present - they ended last week at $10.32.
A dramatic turnaround in the European operations would act as a share price catalyst but that isn't his base forecast, Mr Moghe said.
