Reviewing Kansas City Southern (KSU) and Its Peers
Kansas City Southern (NYSE: KSU) is one of 28 publicly-traded companies in the “Ground Freight & Logistics” industry, but how does it weigh in compared to its competitors? We will compare Kansas City Southern to related companies based on the strength of its earnings, risk, institutional ownership, profitability, valuation, analyst recommendations and dividends.
Risk & Volatility
Kansas City Southern has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500. Comparatively, Kansas City Southern’s competitors have a beta of 1.38, suggesting that their average stock price is 38% more volatile than the S&P 500.
Institutional and Insider Ownership
84.6% of Kansas City Southern shares are owned by institutional investors. Comparatively, 71.3% of shares of all “Ground Freight & Logistics” companies are owned by institutional investors. 1.0% of Kansas City Southern shares are owned by insiders. Comparatively, 12.0% of shares of all “Ground Freight & Logistics” companies are owned by 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.
This table compares Kansas City Southern and its competitors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kansas City Southern||21.52%||11.40%||5.68%|
|Kansas City Southern Competitors||10.86%||15.03%||5.33%|
Earnings and Valuation
This table compares Kansas City Southern and its competitors gross revenue, earnings per share and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Kansas City Southern||$2.47 billion||$1.18 billion||21.45|
|Kansas City Southern Competitors||$5.92 billion||$1.74 billion||-7.46|
Kansas City Southern’s competitors have higher revenue and earnings than Kansas City Southern. Kansas City Southern is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.
Kansas City Southern pays an annual dividend of $1.44 per share and has a dividend yield of 1.3%. Kansas City Southern pays out 28.9% of its earnings in the form of a dividend. As a group, “Ground Freight & Logistics” companies pay a dividend yield of 1.6% and pay out 36.3% of their earnings in the form of a dividend. Kansas City Southern has increased its dividend for 3 consecutive years.
This is a breakdown of recent ratings and target prices for Kansas City Southern and its competitors, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kansas City Southern||0||10||7||0||2.41|
|Kansas City Southern Competitors||231||1394||1832||72||2.49|
Kansas City Southern presently has a consensus price target of $105.77, suggesting a potential downside of 0.97%. As a group, “Ground Freight & Logistics” companies have a potential upside of 10.47%. Given Kansas City Southern’s competitors stronger consensus rating and higher probable upside, analysts plainly believe Kansas City Southern has less favorable growth aspects than its competitors.
Kansas City Southern competitors beat Kansas City Southern on 10 of the 15 factors compared.
About Kansas City Southern
Kansas City Southern (KCS) is a holding company. The Company has domestic and international rail operations in North America that are focused on the north/south freight corridor connecting commercial and industrial markets in the central United States with industrial cities in Mexico. The Company’s subsidiaries include The Kansas City Southern Railway Company (KCSR) and Kansas City Southern de Mexico, S.A. de C.V. (KCSM). KCSR serves a 10-state region in the midwest and southeast regions of the United States and has the north/south rail route between Kansas City, Missouri and various ports along the Gulf of Mexico in Alabama, Louisiana, Mississippi and Texas. KCSM operates a corridor of the Mexican railroad system. KCSM’s rail lines provide rail access to the United States and Mexico border crossing at Nuevo Laredo, Tamaulipas. KCSM also provides rail access to the Port of Lazaro Cardenas on the Pacific Ocean.
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