Celadon Group (NYSE: CGI) and Landstar System (NASDAQ:LSTR) are both transportation companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitabiliy, dividends, institutional ownership, risk, valuation, earnings and analyst recommendations.

Dividends

Celadon Group pays an annual dividend of $0.08 per share and has a dividend yield of 1.6%. Landstar System pays an annual dividend of $0.36 per share and has a dividend yield of 0.4%. Celadon Group pays out 40.0% of its earnings in the form of a dividend. Landstar System pays out 10.8% 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.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Celadon Group and Landstar System, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Celadon Group 0 3 5 0 2.63
Landstar System 1 5 3 0 2.22

Celadon Group presently has a consensus target price of $20.72, indicating a potential upside of 327.15%. Landstar System has a consensus target price of $83.00, indicating a potential downside of 6.90%. Given Celadon Group’s stronger consensus rating and higher probable upside, research analysts plainly believe Celadon Group is more favorable than Landstar System.

Risk & Volatility

Celadon Group has a beta of 1.64, indicating that its share price is 64% more volatile than the S&P 500. Comparatively, Landstar System has a beta of 0.76, indicating that its share price is 24% less volatile than the S&P 500.

Profitability

This table compares Celadon Group and Landstar System’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Celadon Group 0.50% 1.41% 0.49%
Landstar System 4.34% 26.51% 13.34%

Valuation & Earnings

This table compares Celadon Group and Landstar System’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Celadon Group $1.05 billion 0.13 $83.46 million $0.20 24.25
Landstar System $3.24 billion 1.15 $261.88 million $3.33 26.77

Landstar System has higher revenue and earnings than Celadon Group. Celadon Group is trading at a lower price-to-earnings ratio than Landstar System, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

97.4% of Landstar System shares are held by institutional investors. 3.8% of Celadon Group shares are held by company insiders. Comparatively, 1.3% of Landstar System shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Landstar System beats Celadon Group on 10 of the 16 factors compared between the two stocks.

Celadon Group Company Profile

Celadon Group, Inc. (Celadon) is a truckload freight transportation provider. The Company’s segments are asset-based, asset-light, and equipment leasing and services. Its services involve point-to-point shipping for its customers within the United States, between the United States and Mexico, and between the United States and Canada. The Company’s primary asset-based services include the United States domestic dry van, refrigerated and flatbed service; cross-border service between the United States and each of Mexico and Canada; intra-Mexico and intra-Canada service; contract service; regional and specialized short haul service, and rail intermodal service. The Company’s primary asset-light services include freight brokerage, warehousing, less-than truckload consolidation and supply chain logistics services. Celadon’s equipment leasing and services segment consists primarily of leasing activities with independent contractors and other trucking fleets.

Landstar System Company Profile

Landstar System, Inc. (Landstar) is an asset-light provider of integrated transportation management solutions. The Company offers services to its customers across multiple transportation modes, with the ability to arrange for individual shipments of freight to enterprise solutions to manage customer’s transportation needs. It operates in two segments: the Transportation Logistics segment and the Insurance segment. The Transportation Logistics segment provides a range of integrated transportation management solutions. Transportation services offered by it include truckload and less-than-truckload transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air delivery of time-critical freight, heavy-haul or specialized, the United States-Canada and the United States-Mexico cross-border, project cargo and customs brokerage. The insurance segment consists of Signature Insurance Company, which is an offshore insurance subsidiary, and Risk Management Claim Services, Inc.

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