Analyzing Full Truck Alliance (NYSE:YMM) & RXO (NYSE:RXO)

Full Truck Alliance (NYSE:YMM) and RXO (NYSE:RXO) are both mid-cap industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, dividends, analyst recommendations and valuation.

Risk and Volatility

Full Truck Alliance has a beta of 0.22, meaning that its share price is 78% less volatile than the S&P 500. Comparatively, RXO has a beta of 2.1, meaning that its share price is 110% more volatile than the S&P 500.

Institutional and Insider Ownership

39.0% of Full Truck Alliance shares are owned by institutional investors. Comparatively, 92.7% of RXO shares are owned by institutional investors. 16.5% of Full Truck Alliance shares are owned by insiders. Comparatively, 0.8% of RXO shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Full Truck Alliance and RXO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Full Truck Alliance	33.07%	10.68%	9.65%
RXO	-1.72%	-0.98%	-0.45%

Earnings & Valuation

This table compares Full Truck Alliance and RXO”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Full Truck Alliance	$1.79 billion	4.99	$630.36 million	$0.59	14.50
RXO	$5.74 billion	0.83	-$100.00 million	($0.61)	-47.64

Full Truck Alliance has higher earnings, but lower revenue than RXO. RXO is trading at a lower price-to-earnings ratio than Full Truck Alliance, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for Full Truck Alliance and RXO, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Full Truck Alliance	0	3	6	0	2.67
RXO	1	15	4	0	2.15

Full Truck Alliance currently has a consensus target price of $11.30, suggesting a potential upside of 32.03%. RXO has a consensus target price of $26.08, suggesting a potential downside of 10.25%. Given Full Truck Alliance’s stronger consensus rating and higher possible upside, research analysts clearly believe Full Truck Alliance is more favorable than RXO.

Summary

Full Truck Alliance beats RXO on 11 of the 14 factors compared between the two stocks.

About Full Truck Alliance

Full Truck Alliance Co. Ltd., together with its subsidiaries, operates a digital freight platform that connects shippers with truckers to facilitate shipments across distance ranges, cargo weights, and types in the People's Republic of China. The company offers freight matching services, such as freight listing and brokerage services; and online transaction services, as well as various value-added services, such as credit solutions, insurance brokerage, software solutions, electronic toll collection, and energy services. It also provides technology development and other services. The company was founded in 2011 and is based in Guiyang, China.

About RXO

RXO, Inc. provides full truckload freight transportation brokering services. It also offers brokered services for managed transportation, last mile, and freight forwarding. The company was incorporated in 2022 and is based in Charlotte, North Carolina.