Analyzing Covenant Logistics Group (CVLG) & Its Peers

Covenant Logistics Group (NYSE:CVLG) is one of 101 publicly-traded companies in the “Ground Transportation” industry, but how does it contrast to its competitors? We will compare Covenant Logistics Group to similar businesses based on the strength of its analyst recommendations, dividends, profitability, earnings, valuation, institutional ownership and risk.

Institutional and Insider Ownership

83.7% of Covenant Logistics Group shares are owned by institutional investors. Comparatively, 60.6% of shares of all “Ground Transportation” companies are owned by institutional investors. 36.7% of Covenant Logistics Group shares are owned by insiders. Comparatively, 15.5% of shares of all “Ground Transportation” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Covenant Logistics Group and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Covenant Logistics Group	0.31%	9.14%	3.68%
Covenant Logistics Group Competitors	5.40%	9.38%	3.79%

Dividends

Covenant Logistics Group pays an annual dividend of $0.28 per share and has a dividend yield of 0.8%. Covenant Logistics Group pays out 254.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Ground Transportation” companies pay a dividend yield of 1.5% and pay out 28.3% of their earnings in the form of a dividend. Covenant Logistics Group has raised its dividend for 1 consecutive years. Covenant Logistics Group lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Analyst Recommendations

This is a summary of recent ratings and price targets for Covenant Logistics Group and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Covenant Logistics Group	1	0	4	2	3.00
Covenant Logistics Group Competitors	1323	6332	8436	253	2.47

Covenant Logistics Group currently has a consensus price target of $51.80, indicating a potential upside of 47.62%. As a group, “Ground Transportation” companies have a potential upside of 14.00%. Given Covenant Logistics Group’s stronger consensus rating and higher probable upside, analysts plainly believe Covenant Logistics Group is more favorable than its competitors.

Risk and Volatility

Covenant Logistics Group has a beta of 1.32, meaning that its stock price is 32% more volatile than the S&P 500. Comparatively, Covenant Logistics Group’s competitors have a beta of 0.98, meaning that their average stock price is 2% less volatile than the S&P 500.

Valuation & Earnings

This table compares Covenant Logistics Group and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Covenant Logistics Group	$1.16 billion	$7.24 million	319.00
Covenant Logistics Group Competitors	$8.87 billion	$920.60 million	50.70

Covenant Logistics Group’s competitors have higher revenue and earnings than Covenant Logistics Group. Covenant Logistics Group is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Summary

Covenant Logistics Group beats its competitors on 8 of the 15 factors compared.

Covenant Logistics Group Company Profile

Covenant Logistics Group, Inc., together with its subsidiaries, provides transportation and logistics services in the United States. It operates through four segments: Expedited, Dedicated, Managed Freight, and Warehousing. The Expedited segment primarily provides truckload services with high service freight and delivery standards, such as 1,000 miles in 22 hours or 15-minute delivery windows. The Dedicated segment provides customers with committed truckload capacity over contracted periods using equipment either owned or leased by the company. The Managed Freight segment offers brokerage services, including logistics capacity by outsourcing the carriage of customers’ freight to third parties; and transport management services, such as logistics services on a contractual basis to customers who prefer to outsource their logistics needs. The Warehousing segment provides day-to-day warehouse management services to customers. The segment also provides shuttle and switching services to shuttling containers and trailers. The company also engages in used equipment sales and leasing business. It serves transportation companies, such as parcel freight forwarders, less-than-truckload carriers, and third-party logistics providers; and traditional truckload customers, including manufacturers, retailers, and food and beverage shippers. As of December 31, 2021, it operated 2,291 tractors and 5,331 trailers. The company was formerly known as Covenant Transportation Group, Inc. and changed its name to Covenant Logistics Group, Inc. in July 2020. Covenant Logistics Group, Inc. was founded in 1986 and is based in Chattanooga, Tennessee.