Contrasting Heartland Express (HTLD) and Genesee & Wyoming (GWR)

Heartland Express (NASDAQ: HTLD) and Genesee & Wyoming (NYSE:GWR) are both transportation companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, profitability, institutional ownership and earnings.

Institutional & Insider Ownership

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61.6% of Heartland Express shares are owned by institutional investors. Comparatively, 96.3% of Genesee & Wyoming shares are owned by institutional investors. 42.1% of Heartland Express shares are owned by insiders. Comparatively, 3.5% of Genesee & Wyoming shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Heartland Express and Genesee & Wyoming’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Heartland Express 12.38% 7.84% 5.49%
Genesee & Wyoming 24.87% 5.23% 2.30%

Earnings and Valuation

This table compares Heartland Express and Genesee & Wyoming’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Heartland Express $607.34 million 2.57 $75.17 million $0.90 20.83
Genesee & Wyoming $2.21 billion 2.02 $549.05 million $8.77 8.12

Genesee & Wyoming has higher revenue and earnings than Heartland Express. Genesee & Wyoming is trading at a lower price-to-earnings ratio than Heartland Express, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Heartland Express has a beta of 0.6, meaning that its stock price is 40% less volatile than the S&P 500. Comparatively, Genesee & Wyoming has a beta of 1.75, meaning that its stock price is 75% more volatile than the S&P 500.

Dividends

Heartland Express pays an annual dividend of $0.08 per share and has a dividend yield of 0.4%. Genesee & Wyoming does not pay a dividend. Heartland Express pays out 8.9% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Heartland Express and Genesee & Wyoming, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Heartland Express 3 2 1 0 1.67
Genesee & Wyoming 0 3 5 0 2.63

Heartland Express presently has a consensus price target of $22.40, suggesting a potential upside of 19.47%. Genesee & Wyoming has a consensus price target of $80.20, suggesting a potential upside of 12.69%. Given Heartland Express’ higher possible upside, research analysts clearly believe Heartland Express is more favorable than Genesee & Wyoming.

Summary

Genesee & Wyoming beats Heartland Express on 9 of the 16 factors compared between the two stocks.

About Heartland Express

Heartland Express, Inc. is a holding company. The Company is a short-to-medium haul truckload carrier. The Company focuses primarily on short- to medium-haul, asset-based dry van truckload services in regional markets near its terminals. The Company’s truckload services are primarily asset-based transportation services in the dry van truckload market, and it also offers truckload temperature-controlled transportation services and non-asset based brokerage services. All tractors are equipped with mobile communication systems. Its primary customers include retailers and manufacturers. It provides nationwide asset-based dry van truckload service for shippers from Washington to Florida and New England to California. The Company provides truckload services across the United States and parts of Canada. As of December 31, 2016, it had operated 20 terminal facilities throughout the contiguous United States in addition to its terminal and corporate headquarters in North Liberty, Iowa.

About Genesee & Wyoming

Genesee & Wyoming Inc. owns and operates freight railroads across the world. As of December 31, 2016, the Company owned or leased 122 freight railroads worldwide that are organized in 10 operating regions. The Company operates through three segments, which include North American Operations, Australian Operations and U.K./European Operations. In North America, the Company has operations in eight regions, such as Central, Coastal (which includes industrial switching and port operations), Midwest, Mountain West (which includes industrial switching operations), Northeast, Pacific, Southern and Canada. Outside the United States, the Company has operations in two regions: Australia and the United Kingdom/Europe (which consists of operations in the United Kingdom, Belgium, Germany, the Netherlands and Poland, as well as the provision of management and technical support through Freightliner to Saudi Arabia Railway Company).

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