Echo Global Logistics (ECHO) & Brink’s (BCO) Critical Review

Echo Global Logistics (NASDAQ: ECHO) and Brink’s (NYSE:BCO) are both transportation companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Dividends

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Brink’s pays an annual dividend of $0.60 per share and has a dividend yield of 0.8%. Echo Global Logistics does not pay a dividend. Brink’s pays out 19.8% of its earnings in the form of a dividend.

Volatility and Risk

Echo Global Logistics has a beta of 1.44, meaning that its share price is 44% more volatile than the S&P 500. Comparatively, Brink’s has a beta of 1.76, meaning that its share price is 76% more volatile than the S&P 500.

Earnings & Valuation

This table compares Echo Global Logistics and Brink’s’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Echo Global Logistics $1.94 billion 0.40 $12.62 million $0.66 42.42
Brink’s $3.35 billion 1.11 $16.70 million $3.03 24.29

Brink’s has higher revenue and earnings than Echo Global Logistics. Brink’s is trading at a lower price-to-earnings ratio than Echo Global Logistics, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Echo Global Logistics and Brink’s’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Echo Global Logistics 0.65% 5.22% 2.26%
Brink’s 0.50% 36.76% 6.06%

Insider and Institutional Ownership

99.0% of Echo Global Logistics shares are owned by institutional investors. Comparatively, 93.1% of Brink’s shares are owned by institutional investors. 8.1% of Echo Global Logistics shares are owned by company insiders. Comparatively, 2.5% of Brink’s shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Echo Global Logistics and Brink’s, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Echo Global Logistics 1 3 6 0 2.50
Brink’s 0 0 5 0 3.00

Echo Global Logistics currently has a consensus target price of $29.88, suggesting a potential upside of 6.70%. Brink’s has a consensus target price of $98.00, suggesting a potential upside of 33.15%. Given Brink’s’ stronger consensus rating and higher possible upside, analysts plainly believe Brink’s is more favorable than Echo Global Logistics.

Summary

Brink’s beats Echo Global Logistics on 10 of the 16 factors compared between the two stocks.

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.

About Brink’s

The Brink's Company provides secure transportation, cash management, and other security-related services worldwide. The company offers cash-in-transit services, including armored vehicle transportation of valuables; automated teller machine (ATM) services, such as cash replenishment, replenishment forecasting, cash optimization, ATM remote monitoring, service call dispatching, transaction processing, installation, and first and second line maintenance; and network infrastructure services. It also provides transportation services for valued commodities, including diamonds, jewelry, precious metals, securities, currency, high-tech devices, electronics, and pharmaceuticals; and cash management services, such as money processing, deploying and servicing intelligent safes and safe control devices, and check imaging, as well as cashier balancing, counterfeit detection, account consolidation, and electronic reporting services. In addition, the company offers payment services, including bill payment processing, mobile phone top-up, and prepaid cards; and commercial security system services, such as security system design and installation services that include alarms, motion detectors, closed-circuit televisions, and digital video recorders, as well as access control systems comprising card and biometric readers, electronic locks, and turnstiles. Further, it provides security and guarding services to protect airports, offices, warehouses, stores, and public venues. The company serves banks and financial institutions, retailers, government agencies, mints, jewelers, and other commercial operations. The company was formerly known as The Pittston Company and changed its name to The Brink's Company in May 2003. The Brink's Company was founded in 1838 and is headquartered in Richmond, Virginia.

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