Roadrunner Transportation Systems (NASDAQ: RRTS) and Echo Global Logistics (NASDAQ:ECHO) are both small-cap industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, institutional ownership, valuation and risk.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Roadrunner Transportation Systems and Echo Global Logistics, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Roadrunner Transportation Systems 0 2 1 0 2.33
Echo Global Logistics 0 3 6 0 2.67

Roadrunner Transportation Systems presently has a consensus target price of $9.67, indicating a potential upside of 5.42%. Echo Global Logistics has a consensus target price of $20.88, indicating a potential upside of 6.23%. Given Echo Global Logistics’ stronger consensus rating and higher probable upside, analysts clearly believe Echo Global Logistics is more favorable than Roadrunner Transportation Systems.

Institutional and Insider Ownership

87.5% of Echo Global Logistics shares are held by institutional investors. 8.1% of Echo Global Logistics shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Roadrunner Transportation Systems and Echo Global Logistics’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Roadrunner Transportation Systems $1.97 billion 0.18 $100.85 million N/A N/A
Echo Global Logistics $1.75 billion 0.32 $31.70 million ($0.13) -151.14

Roadrunner Transportation Systems has higher revenue and earnings than Echo Global Logistics.

Profitability

This table compares Roadrunner Transportation Systems and Echo Global Logistics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Roadrunner Transportation Systems 1.49% 5.11% 2.40%
Echo Global Logistics -0.21% 3.22% 1.47%

Summary

Echo Global Logistics beats Roadrunner Transportation Systems on 6 of the 11 factors compared between the two stocks.

About Roadrunner Transportation Systems

Roadrunner Transportation Systems, Inc. (RRTS) is an asset-light transportation and logistics service provider. The Company offers a suite of global supply chain solutions, including truckload logistics (TL), customized and expedited less-than-truckload (LTL), intermodal solutions (transporting a shipment by over one mode, primarily through rail and truck), freight consolidation, inventory management, expedited services, air freight, international freight forwarding, customs brokerage and transportation management solutions. The Company operates through three segments: Truckload Logistics, Less-than-Truckload and Global Solutions. The Company utilizes a third-party network of transportation providers, consisting of independent contractors (ICs) and purchased power providers, to serve a diverse customer base. It primarily focuses on small to mid-size shippers.

About Echo Global Logistics

Echo Global Logistics, Inc. is a provider of technology-enabled transportation and supply chain management solutions. The Company utilizes a technology platform to compile and analyze data from its multi-modal network of transportation providers to facilitate its transportation and logistics services. The Company focuses primarily on arranging transportation by truckload (TL) and less than truckload (LTL) carriers. It also offers intermodal (which involves moving a shipment by rail and truck), small parcel, domestic air, expedited and international transportation services. The Company’s core logistics services include rate negotiation, shipment execution and tracking, carrier selection and management, routing compliance freight bill payment and audit, payment and performance management and reporting functions.

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