Comparing Full Truck Alliance (NYSE:YMM) & Canadian Pacific Kansas City (NYSE:CP)

Canadian Pacific Kansas City (NYSE:CP) and Full Truck Alliance (NYSE:YMM) are both industrials companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, analyst recommendations, risk, valuation, dividends and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations for Canadian Pacific Kansas City and Full Truck Alliance, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Canadian Pacific Kansas City	0	4	12	1	2.82
Full Truck Alliance	0	3	6	0	2.67

Canadian Pacific Kansas City currently has a consensus target price of $112.00, indicating a potential upside of 22.68%. Full Truck Alliance has a consensus target price of $11.30, indicating a potential upside of 28.72%. Given Full Truck Alliance’s higher probable upside, analysts clearly believe Full Truck Alliance is more favorable than Canadian Pacific Kansas City.

Institutional and Insider Ownership

72.2% of Canadian Pacific Kansas City shares are held by institutional investors. Comparatively, 39.0% of Full Truck Alliance shares are held by institutional investors. 0.0% of Canadian Pacific Kansas City shares are held by company insiders. Comparatively, 16.5% of Full Truck Alliance shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Canadian Pacific Kansas City and Full Truck Alliance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Canadian Pacific Kansas City	24.14%	9.27%	4.96%
Full Truck Alliance	33.07%	10.68%	9.65%

Earnings & Valuation

This table compares Canadian Pacific Kansas City and Full Truck Alliance”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Canadian Pacific Kansas City	$10.79 billion	7.36	$2.96 billion	$3.12	29.26
Full Truck Alliance	$1.79 billion	5.12	$630.36 million	$0.59	14.87

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

Dividends

Canadian Pacific Kansas City pays an annual dividend of $0.77 per share and has a dividend yield of 0.8%. Full Truck Alliance pays an annual dividend of $0.34 per share and has a dividend yield of 3.9%. Canadian Pacific Kansas City pays out 24.7% of its earnings in the form of a dividend. Full Truck Alliance pays out 57.6% 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.

Volatility & Risk

Canadian Pacific Kansas City has a beta of 1.06, suggesting that its share price is 6% more volatile than the S&P 500. Comparatively, Full Truck Alliance has a beta of 0.25, suggesting that its share price is 75% less volatile than the S&P 500.

Summary

Canadian Pacific Kansas City beats Full Truck Alliance on 11 of the 17 factors compared between the two stocks.

About Canadian Pacific Kansas City

Canadian Pacific Kansas City Limited, together with its subsidiaries, owns and operates a transcontinental freight railway in Canada, the United States, and Mexico. The company transports bulk commodities, including grain, coal, potash, fertilizers, and sulphur; merchandise freight, such as forest products, energy, chemicals and plastics, metals, minerals, consumer products, and automotive; and intermodal traffic comprising retail goods in overseas containers. It also provides rail and intermodal transportation services over a network of approximately 20,000 miles serving business centres. The company was formerly known as Canadian Pacific Railway Limited and changed its name to Canadian Pacific Kansas City Limited in April 2023. Canadian Pacific Kansas City Limited was incorporated in 1881 and is headquartered in Calgary, Canada.

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.