WEST JAPAN RWY/S (WJRYY) versus Forward Air (FWRD) Critical Survey

WEST JAPAN RWY/S (OTCMKTS:WJRYY) and Forward Air (NASDAQ:FWRD) are both transportation companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Profitability

This table compares WEST JAPAN RWY/S and Forward Air’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
WEST JAPAN RWY/S 7.53% 11.04% 4.03%
Forward Air 7.85% 15.63% 11.87%

Valuation and Earnings

This table compares WEST JAPAN RWY/S and Forward Air’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
WEST JAPAN RWY/S $13.55 billion 1.00 $1.04 billion $5.48 12.79
Forward Air $1.10 billion 1.73 $87.32 million $2.36 27.66

WEST JAPAN RWY/S has higher revenue and earnings than Forward Air. WEST JAPAN RWY/S is trading at a lower price-to-earnings ratio than Forward Air, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

WEST JAPAN RWY/S has a beta of 0.6, indicating that its stock price is 40% less volatile than the S&P 500. Comparatively, Forward Air has a beta of 1.52, indicating that its stock price is 52% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for WEST JAPAN RWY/S and Forward Air, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
WEST JAPAN RWY/S 0 0 0 0 N/A
Forward Air 0 1 2 0 2.67

Forward Air has a consensus target price of $69.33, indicating a potential upside of 6.21%. Given Forward Air’s higher possible upside, analysts clearly believe Forward Air is more favorable than WEST JAPAN RWY/S.

Dividends

WEST JAPAN RWY/S pays an annual dividend of $0.56 per share and has a dividend yield of 0.8%. Forward Air pays an annual dividend of $0.72 per share and has a dividend yield of 1.1%. WEST JAPAN RWY/S pays out 10.2% of its earnings in the form of a dividend. Forward Air pays out 30.5% 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. Forward Air has increased its dividend for 2 consecutive years. Forward Air is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

0.2% of WEST JAPAN RWY/S shares are owned by institutional investors. Comparatively, 96.0% of Forward Air shares are owned by institutional investors. 2.0% of Forward Air shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Forward Air beats WEST JAPAN RWY/S on 12 of the 16 factors compared between the two stocks.

WEST JAPAN RWY/S Company Profile

West Japan Railway Company provides passenger railway transport services in Japan. The company operates through Transportation Operations, Retail Business, Real Estate Business, and Other Businesses segments. It operates a railway network that stretches across an area of approximately 104,000 square kilometers covering 18 prefectures in western Honshu and the northern tip of Kyushu comprising a total of 1,200 railway stations with an operating route length of 5,008.7 kilometers. The company also operates high-speed intercity passenger service between Shin-Osaka station in Osaka and Hakata station in Fukuoka in northern Kyushu; and high-speed intercity passenger service between Tokyo and Kanazawa stations. In addition, its urban network offers service to the Kyoto–Osaka–Kobe metropolitan area with an operating route length of 946.0 kilometers. Further, the company operates other conventional lines with an operating route length of 3,250.1 kilometers comprising intercity transport provided by limited express and express services; regional transport for commuters and students in and around regional hub cities, such as Hiroshima and Okayama; and local lines with low transport density, as well as TWILIGHT EXPRESS MIZUKAZE, a sleeper train to invigorate the West Japan Area. Additionally, it offers bus and ferry services; operates convenience stores, department stores, specialty stores, food and beverage outlets, and tourism campaigns; and provides travel agency, advertising agency, hotel, maintenance and engineering, and other services. The company is also involved in the sale and leasing of residential and urban development properties; management of shopping centers in station buildings and other facilities; operation of large station buildings at hub railway stations; and development of commercial facilities near railway station areas and underneath elevated tracks. West Japan Railway Company was founded in 1987 and is headquartered in Osaka, Japan.

Forward Air Company Profile

Forward Air Corporation, together with its subsidiaries, operates as an asset-light freight and logistics company in the United State and Canada. The company operates through four segments: Expedited Less-than-truckload (LTL), Truckload Premium Services (TLS), Intermodal, and Pool Distribution (Pool). The Expedited LTL segment provides expedited regional, inter-regional, and national LTL services, as well as local pick-up and delivery services. It also offers shipment consolidation and deconsolidation, warehousing, customs brokerage, and other handling services. This segment provides its transportation services through a network of terminals located at or near airports. The TLS segment offers expedited truckload brokerage, dedicated fleet, and high security and temperature-controlled logistics services. The Intermodal segment provides intermodal container drayage services; and contract, and container freight station warehouse and handling services. The Pool segment offers high-frequency handling and distribution of time-sensitive products to various destinations. Forward Air Corporation was founded in 1981 and is headquartered in Greeneville, Tennessee.

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