Werner Enterprises' (WERN) move away from one-way truckload toward dedicated fleet services just as the market turns may reduce the company's immediate torque to the truckload cycle, Morgan Stanley said in a note Tuesday.

Overall, the investment firm said the company may benefit from the shift as the dedicated business is likely to be a "big share-gainer" in an upcycle, with management lifting its full-year dedicated rate guidance on a "very strong" pipeline.

Management said Q1 saw the "strongest" pricing inflection in over 3 years and Q2 guidance indicates a modest upside to consensus, while being consistent with Morgan Stanley estimates, according to the note.

While one-way truckload revenue per total mile guidance of 1% to 4% growth in Q2 was a little soft versus market trends, management said this reflects the pivot into dedicated, the firm said.

Morgan Stanley said Werner remains somewhat of a show-me story within truckload, given the timing of its pivot, completing the FirstFleet acquisition, and proving it has resolved some of its recent cost issues.

Morgan Stanley maintained an overweight rating on the stock and lifted the price target to $47 from $45.

Shares of Werner Enterprises rose more than 6% in Wednesday trading.

Price: 36.68, Change: +2.28, Percent Change: +6.63