Echo Global Logistics (NASDAQ: ECHO) and Core-Mark Holding (NASDAQ:CORE) are both small-cap transportation companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitabiliy and risk.

Risk & Volatility

Echo Global Logistics has a beta of 1.39, indicating that its share price is 39% more volatile than the S&P 500. Comparatively, Core-Mark Holding has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Insider and Institutional Ownership

90.7% of Echo Global Logistics shares are held by institutional investors. Comparatively, 98.3% of Core-Mark Holding shares are held by institutional investors. 8.1% of Echo Global Logistics shares are held by insiders. Comparatively, 2.5% of Core-Mark Holding shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Core-Mark Holding pays an annual dividend of $0.36 per share and has a dividend yield of 1.0%. Echo Global Logistics does not pay a dividend. Core-Mark Holding pays out 32.7% of its earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Echo Global Logistics and Core-Mark Holding, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Echo Global Logistics 0 3 5 0 2.63
Core-Mark Holding 0 1 3 0 2.75

Echo Global Logistics currently has a consensus price target of $21.33, suggesting a potential upside of 44.14%. Core-Mark Holding has a consensus price target of $40.75, suggesting a potential upside of 13.92%. Given Echo Global Logistics’ higher probable upside, research analysts clearly believe Echo Global Logistics is more favorable than Core-Mark Holding.

Profitability

This table compares Echo Global Logistics and Core-Mark Holding’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Echo Global Logistics -0.21% 3.22% 1.47%
Core-Mark Holding 0.34% 11.42% 4.24%

Earnings and Valuation

This table compares Echo Global Logistics and Core-Mark Holding’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Echo Global Logistics $1.75 billion 0.24 $31.70 million ($0.13) -113.84
Core-Mark Holding $11.86 billion 0.14 $130.70 million $1.10 32.52

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

Summary

Core-Mark Holding beats Echo Global Logistics on 9 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 Core-Mark Holding

Core-Mark Holding Company, Inc. is a wholesale distributor to the convenience retail industry in North America. The Company provides sales, marketing, distribution and logistics services. As of December 31, 2016, the Company offered services to over 43,000 customer locations across the United States and Canada through 30 distribution centers. The Company’s segments include the United States, Canada and Corporate. The Company’s primary customer base consists of traditional convenience stores, as well as alternative outlets selling consumer packaged goods. The Company’s traditional convenience store customers include various national and super-regional convenience store operators, as well as independently owned convenience stores. Its alternative outlet customers include a range of store formats, including grocery stores, drug stores, liquor stores, cigarette and tobacco shops, hotel gift shops, military exchanges, college and corporate campuses, casinos and hardware stores.

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