Critical Review: Canadian Pacific Railway Limited (CP) vs. Amerco (UHAL)
Canadian Pacific Railway Limited (NYSE: CP) and Amerco (NASDAQ:UHAL) are both mid-cap transportation companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, earnings, dividends, institutional ownership, profitability and analyst recommendations.
This table compares Canadian Pacific Railway Limited and Amerco’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Canadian Pacific Railway Limited||25.49%||33.06%||8.38%|
Insider and Institutional Ownership
65.9% of Canadian Pacific Railway Limited shares are held by institutional investors. Comparatively, 30.0% of Amerco shares are held by institutional investors. 0.0% of Canadian Pacific Railway Limited shares are held by insiders. Comparatively, 42.6% of Amerco shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Earnings and Valuation
This table compares Canadian Pacific Railway Limited and Amerco’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Canadian Pacific Railway Limited||$5.08 billion||4.61||$2.61 billion||$8.40||19.07|
|Amerco||$3.46 billion||2.17||$1.19 billion||$19.27||19.90|
Canadian Pacific Railway Limited has higher revenue and earnings than Amerco. Canadian Pacific Railway Limited is trading at a lower price-to-earnings ratio than Amerco, indicating that it is currently the more affordable of the two stocks.
Canadian Pacific Railway Limited pays an annual dividend of $1.67 per share and has a dividend yield of 1.0%. Amerco does not pay a dividend. Canadian Pacific Railway Limited pays out 19.9% of its earnings in the form of a dividend.
This is a summary of current ratings and price targets for Canadian Pacific Railway Limited and Amerco, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Canadian Pacific Railway Limited||0||3||19||0||2.86|
Canadian Pacific Railway Limited currently has a consensus target price of $187.72, suggesting a potential upside of 17.17%. Given Canadian Pacific Railway Limited’s higher possible upside, research analysts clearly believe Canadian Pacific Railway Limited is more favorable than Amerco.
Volatility & Risk
Canadian Pacific Railway Limited has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, Amerco has a beta of 1.12, meaning that its share price is 12% more volatile than the S&P 500.
Canadian Pacific Railway Limited beats Amerco on 10 of the 15 factors compared between the two stocks.
About Canadian Pacific Railway Limited
Canadian Pacific Railway Limited, together with its subsidiaries, owns and operates a transcontinental freight railway in Canada and the United States. The Company operates through rail transportation segment. The Company’s transports bulk commodities, merchandise freight, and intermodal traffic over a network of approximately 12,400 miles. Its railway feeds directly into the United States heartland from the east and west coasts. Its Bulk commodities include grain, coal, potash, fertilizers and sulfur. Its Merchandise freight consists of finished vehicles and machinery, as well as forest and industrial and consumer products. Its Intermodal traffic consists of retail goods in overseas containers that can be transported by train, ship and truck and in domestic containers and trailers that can be moved by train and truck. Its subsidiaries include Canadian Pacific Railway Company, Soo Line Railroad Company, Delaware and Hudson Railway Company, Inc. and Mount Stephen Properties Inc.
AMERCO is a do-it-yourself moving and storage operator through its subsidiary, U-Haul International, Inc. (U-Haul). The Company supplies its products and services to help people move and store their household and commercial goods through U-Haul. It sells U-Haul brand boxes, tape, and other moving and self-storage products and services to do-it-yourself moving and storage customers at its distribution outlets and through uhaul.com and eMove Websites. The Company operates through three segments: Moving and Storage; Property and Casualty Insurance, and Life Insurance. The Moving and Storage segment includes the operations of AMERCO, U-Haul and Amerco Real Estate Company, and the subsidiaries of U-Haul and Real Estate. The Property and Casualty Insurance segment consists of the operations of Repwest Insurance Company and its subsidiaries, and ARCOA Risk Retention Group. The Life Insurance segment consists of the operations of Oxford Life Insurance Company and its subsidiaries.
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