XPO Logistics (XPO) versus Canadian National Railway (CNI) Financial Analysis
XPO Logistics (NYSE: XPO) and Canadian National Railway (NYSE:CNI) are both mid-cap transportation companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, profitability, institutional ownership, valuation, earnings, analyst recommendations and dividends.
This table compares XPO Logistics and Canadian National Railway’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Canadian National Railway||30.59%||25.42%||10.24%|
This is a summary of current recommendations for XPO Logistics and Canadian National Railway, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Canadian National Railway||0||13||5||0||2.28|
XPO Logistics currently has a consensus target price of $68.43, indicating a potential upside of 1.68%. Canadian National Railway has a consensus target price of $82.85, indicating a potential upside of 1.37%. Given XPO Logistics’ stronger consensus rating and higher possible upside, analysts plainly believe XPO Logistics is more favorable than Canadian National Railway.
Canadian National Railway pays an annual dividend of $1.32 per share and has a dividend yield of 1.6%. XPO Logistics does not pay a dividend. Canadian National Railway pays out 34.4% of its earnings in the form of a dividend. XPO Logistics has increased its dividend for 5 consecutive years.
Institutional & Insider Ownership
89.5% of XPO Logistics shares are owned by institutional investors. Comparatively, 54.5% of Canadian National Railway shares are owned by institutional investors. 16.9% of XPO Logistics shares are owned by insiders. Comparatively, 2.4% of Canadian National Railway shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Risk and Volatility
XPO Logistics has a beta of 2.37, suggesting that its stock price is 137% more volatile than the S&P 500. Comparatively, Canadian National Railway has a beta of 1.13, suggesting that its stock price is 13% more volatile than the S&P 500.
Valuation and Earnings
This table compares XPO Logistics and Canadian National Railway’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|XPO Logistics||$14.69 billion||0.54||$1.20 billion||$0.87||77.36|
|Canadian National Railway||$10.50 billion||5.85||$5.65 billion||$3.84||21.28|
Canadian National Railway has higher revenue, but lower earnings than XPO Logistics. Canadian National Railway is trading at a lower price-to-earnings ratio than XPO Logistics, indicating that it is currently the more affordable of the two stocks.
XPO Logistics beats Canadian National Railway on 10 of the 17 factors compared between the two stocks.
XPO Logistics Company Profile
XPO Logistics, Inc. is a global provider of supply chain solutions. The Company operates in two segments: Transportation and Logistics. The Transportation segment provides freight brokerage, last mile, less-than-truckload (LTL), full truckload and global forwarding services. The Logistics segment provides a range of contract logistics services, including highly engineered and customized solutions, value-added warehousing and distribution, cold chain solutions and other inventory solutions. Its freight brokerage operations encompass truck brokerage globally, as well as intermodal, drayage and expedite services in North America. In Logistics segment, it provides warehousing and distribution solutions, such as factory support, aftermarket support, integrated manufacturing, packaging, labeling and transportation. As of December 31, 2016, the Company had more than 10,000 independent owner operators under contract to provide drayage, expedite, last mile and LTL services to its customers.
Canadian National Railway Company Profile
Canadian National Railway Company is engaged in the rail and related transportation business. The Company’s network of approximately 20,000 route miles of track spans Canada and mid-America, connecting approximately three coasts, including the Atlantic, the Pacific and the Gulf of Mexico and serving the cities and ports of Vancouver, Prince Rupert (British Columbia), Montreal, Halifax, New Orleans, and Mobile (Alabama), and the metropolitan areas of Toronto, Edmonton, Winnipeg, Calgary, Chicago, Memphis, Detroit, Duluth (Minnesota)/Superior (Wisconsin), and Jackson (Mississippi), with connections to all points in North America. Its network and connections to all Class I railroads provide its customers access to the three North American Free Trade Agreement nations. It carries over 300 million tons of cargo, serving exporters, importers, retailers, farmers and manufacturers. Its freight includes seven commodity representing a portfolio of goods.
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