While nobody likes market pullbacks, they tend to give long-term investors their best opportunities. Sometimes, a fundamentally strong stock slips simply because the overall industry is going through a slow patch. That does not always mean the business itself is broken.
For patient Foolish investors, that gap between price and performance can be a real opportunity. The trick is to focus on companies with strong balance sheets, experienced management teams, and a history of generating steady cash flow in both good times and bad.
That is why TFI International (TSX: TFII) looks interesting right now. Despite the broader market rally, TFI stock has slipped by about 9% over the last year. Yet the company continues to produce solid free cash flow, grow its dividend, and expand its operations. But is this Canadian stock worth considering on this pullback? Let’s find out.
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TFI International stock
If you don’t know it already, TFI International is a Canadian transportation and logistics firm operating across Canada, the United States, and Mexico. This Saint-Laurent-based firm runs three main business segments: less-than-truckload, truckload, and logistics. It handles everything from smaller freight shipments to full truckloads, along with brokerage and logistics services.
At the time of writing, TFI shares trade at $168.16 apiece, giving the company a market cap of $13.8 billion. The stock currently also offers a dividend yield of 1.6%, paid quarterly. The recent decline in shares appears to be more about normal freight cycles than any deeper problem with its business.
A slowdown but not a breakdown
In the third quarter of 2025, TFI’s total revenue fell 10% YoY (year-over-year) to US$1.97 billion. Its operating profit also plunged 21% YoY to US$153.3 million.
At first glance, those financial results might look disappointing. But for a transportation company, cash flow often tells a more important story. And that was the encouraging part in the company’s latest earnings report as its free cash flow came in at US$199.4 million for the quarter. Even in a weaker freight environment, generating nearly US$200 million in free cash flow says a lot about how efficiently TFI’s business is run.
Even amid the ongoing challenges, the company is continuing to adjust operations to protect margins and position itself for the next freight upcycle.
Still rewarding shareholders
Even with softer freight conditions, TFI has not stepped back from rewarding investors. In the third quarter alone, the company returned US$104.8 million to shareholders, including US$37.3 million in dividends and US$67.4 million in share repurchases.
It also approved a 4% increase in the quarterly dividend to US$0.47 per share. Increasing the dividend during a cyclical slowdown shows TFI’s confidence in its long-term cash-generating ability.
And we shouldn’t forget the fact that, despite the recent weakness, TFI stock has climbed more than 750% over the last 10 years.
Why it could keep compounding
Transportation is a cyclical industry. Freight demand rises and falls with the economy. But it never disappears. Goods still need to move across North America, supply chains continue to evolve, and companies rely heavily on efficient logistics partners.
TFI’s broad platform and geographic reach help it manage through these ups and downs. Its mix of asset-heavy and asset-light operations gives it flexibility to adjust capacity, control costs, and make acquisitions when competitors are struggling. That’s one of the key reasons why I believe TFI stock still has big upside potential for long-term investors.
