Reviewing Knight Transportation (KNX) & Celadon Group (NYSE:CGI)
Knight Transportation (NYSE: KNX) and Celadon Group (NYSE:CGI) are both transportation companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, profitabiliy, earnings, valuation, risk, dividends and analyst recommendations.
This is a breakdown of recent ratings and recommmendations for Knight Transportation and Celadon Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Knight Transportation presently has a consensus target price of $37.62, indicating a potential upside of 3.62%. Celadon Group has a consensus target price of $20.72, indicating a potential upside of 318.52%. Given Celadon Group’s stronger consensus rating and higher possible upside, analysts plainly believe Celadon Group is more favorable than Knight Transportation.
Knight Transportation pays an annual dividend of $0.24 per share and has a dividend yield of 0.7%. Celadon Group pays an annual dividend of $0.08 per share and has a dividend yield of 1.6%. Knight Transportation pays out 25.0% of its earnings in the form of a dividend. Celadon Group pays out 40.0% 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. Celadon Group has raised its dividend for 3 consecutive years. Celadon Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation and Earnings
This table compares Knight Transportation and Celadon Group’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Knight Transportation||$1.11 billion||2.63||$239.44 million||$0.96||37.81|
|Celadon Group||$1.05 billion||0.13||$83.46 million||$0.20||24.75|
Knight Transportation has higher revenue and earnings than Celadon Group. Celadon Group is trading at a lower price-to-earnings ratio than Knight Transportation, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Knight Transportation has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500. Comparatively, Celadon Group has a beta of 1.72, indicating that its stock price is 72% more volatile than the S&P 500.
Institutional & Insider Ownership
87.9% of Knight Transportation shares are owned by institutional investors. 9.9% of Knight Transportation shares are owned by company insiders. Comparatively, 3.8% of Celadon Group shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
This table compares Knight Transportation and Celadon Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Knight Transportation beats Celadon Group on 12 of the 17 factors compared between the two stocks.
About Knight Transportation
Knight Transportation, Inc. is a provider of multiple truckload transportation and logistics services, which involve the movement of trailer or container loads of freight from origin to destination for a single customer. The Company operates through two segments: Trucking and Logistics. Its Trucking segment consists of three operating units: dry van truckload, temperature-controlled truckload and drayage services. The Trucking segment provides truckload transportation, including services of various products, goods and materials. Its Logistics segment consists of two operating units: freight brokerage services and rail intermodal. It provides logistics, freight management and other non-trucking services to its customers, through its Logistics segment. It provides a range of truckload and logistics services through its nationwide network of service centers, truckload tractor fleets and its contractual access to third-party capacity providers. It operates primarily in the United States.
About Celadon Group
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.
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