Critical Survey: Landstar System (LSTR) and Werner Enterprises (WERN)
Landstar System (NASDAQ: LSTR) and Werner Enterprises (NASDAQ:WERN) are both mid-cap transportation companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.
This table compares Landstar System and Werner Enterprises’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Landstar System pays an annual dividend of $0.40 per share and has a dividend yield of 0.4%. Werner Enterprises pays an annual dividend of $0.28 per share and has a dividend yield of 0.8%. Landstar System pays out 11.6% of its earnings in the form of a dividend. Werner Enterprises pays out 25.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Institutional and Insider Ownership
97.0% of Landstar System shares are held by institutional investors. Comparatively, 64.1% of Werner Enterprises shares are held by institutional investors. 1.0% of Landstar System shares are held by company insiders. Comparatively, 34.7% of Werner Enterprises shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Risk and Volatility
Landstar System has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, Werner Enterprises has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500.
Valuation and Earnings
This table compares Landstar System and Werner Enterprises’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Landstar System||$3.33 billion||1.19||$271.70 million||$3.46||27.38|
|Werner Enterprises||$2.05 billion||1.23||$334.48 million||$1.10||31.59|
Werner Enterprises has higher revenue, but lower earnings than Landstar System. Landstar System is trading at a lower price-to-earnings ratio than Werner Enterprises, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for Landstar System and Werner Enterprises, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Landstar System presently has a consensus price target of $86.14, suggesting a potential downside of 9.08%. Werner Enterprises has a consensus price target of $30.50, suggesting a potential downside of 12.23%. Given Landstar System’s higher possible upside, analysts clearly believe Landstar System is more favorable than Werner Enterprises.
Landstar System beats Werner Enterprises on 8 of the 15 factors compared between the two stocks.
Landstar System Company Profile
Landstar System, Inc. (Landstar) is an asset-light provider of integrated transportation management solutions. The Company offers services to its customers across multiple transportation modes, with the ability to arrange for individual shipments of freight to enterprise solutions to manage customer’s transportation needs. It operates in two segments: the Transportation Logistics segment and the Insurance segment. The Transportation Logistics segment provides a range of integrated transportation management solutions. Transportation services offered by it include truckload and less-than-truckload transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air delivery of time-critical freight, heavy-haul or specialized, the United States-Canada and the United States-Mexico cross-border, project cargo and customs brokerage. The insurance segment consists of Signature Insurance Company, which is an offshore insurance subsidiary, and Risk Management Claim Services, Inc.
Werner Enterprises Company Profile
Werner Enterprises, Inc. is a transportation and logistics company. The Company is engaged in transporting truckload shipments of general commodities in both interstate and intrastate commerce. It operates through two segments: Truckload and Werner Logistics. It provides logistics services through its Werner Logistics division. As of December 31, 2016, it had a fleet of approximately 7,100 trucks, of which 6,305 were company-operated and 795 were owned and operated by independent contractors. Its Werner Logistics division operated 74 intermodal drayage trucks as of December 31, 2016. Its Truckload segment comprises the One-Way Truckload and Specialized Services units. It operates in several provinces of Canada to provide through-trailer service into and out of Mexico. Its Werner Logistic segment is a non-asset-based transportation and logistics provider and comprises four operating units: truck brokerage, freight management, the intermodal and Werner Global Logistics international.
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