Landstar System (NASDAQ:LSTR) versus DHL Group (OTCMKTS:DHLGY) Financial Analysis

DHL Group (OTCMKTS:DHLGY) and Landstar System (NASDAQ:LSTR) are both industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, profitability, risk, analyst recommendations, institutional ownership, dividends and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for DHL Group and Landstar System, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DHL Group	0	6	3	1	2.50
Landstar System	2	11	3	1	2.18

Landstar System has a consensus target price of $191.14, indicating a potential upside of 15.29%. Given Landstar System’s higher probable upside, analysts plainly believe Landstar System is more favorable than DHL Group.

Dividends

DHL Group pays an annual dividend of $0.77 per share and has a dividend yield of 2.4%. Landstar System pays an annual dividend of $1.76 per share and has a dividend yield of 1.1%. DHL Group pays out 26.9% of its earnings in the form of a dividend. Landstar System pays out 45.6% 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. Landstar System has increased its dividend for 10 consecutive years. DHL Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

98.0% of Landstar System shares are owned by institutional investors. 0.7% of Landstar System shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares DHL Group and Landstar System”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DHL Group	$93.72 billion	0.76	$3.96 billion	$2.86	11.23
Landstar System	$4.74 billion	1.19	$115.01 million	$3.86	42.95

DHL Group has higher revenue and earnings than Landstar System. DHL 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.

Risk and Volatility

DHL Group has a beta of 1.17, indicating that its share price is 17% more volatile than the S&P 500. Comparatively, Landstar System has a beta of 0.9, indicating that its share price is 10% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
DHL Group	4.38%	16.44%	5.22%
Landstar System	2.64%	20.84%	10.42%

Summary

Landstar System beats DHL Group on 9 of the 16 factors compared between the two stocks.

About DHL Group

Deutsche Post AG operates as a mail and logistics company in Germany, rest of Europe, the Americas, the Asia Pacific, the Middle East, and Africa. The company operates through five segments: Express; Global Forwarding, Freight; Supply Chain; eCommerce Solutions; and Post & Parcel Germany. The Express segment offers time-definite courier and express services to business and private customers. The Global Forwarding, Freight segment provides air, ocean, and overland freight forwarding services; and offers multimodal and sector-specific solutions. This segment's business model is based on brokering transport services between customers and freight carriers. The Supply Chain segment delivers customized supply chain solutions to its customers based on modular components, including warehousing and transport services; and value-added services, such as e-fulfilment, omnichannel solutions and returns management, lead logistics partner, real estate solutions, service logistics, and packaging solutions for various industrial sectors. The eCommerce Solutions segment provides parcel delivery and cross-border non-time definite international services. The Post & Parcel Germany segment transports and delivers mail communication, parcels, physical and hybrid letters, and special products for the delivery of goods; and offers additional services, such as registered mail, cash on delivery, and insured items. Deutsche Post AG was founded in 1490 and is headquartered in Bonn, Germany.

About Landstar System

Landstar System, Inc. provides integrated transportation management solutions in the United States, Canada, Mexico, and internationally. It operates through two segments: Transportation Logistics and Insurance. The Transportation Logistics segment offers a range of transportation services, including truckload and less-than-truckload transportation, rail intermodal, air cargo, ocean cargo, expedited ground and air delivery of time-critical freight, heavy-haul/specialized, U.S.-Canada and U.S.-Mexico cross-border, intra-Mexico, intra-Canada, project cargo, and customs brokerage, as well as offers transportation services to other transportation companies, such as third party logistics and less-than-truckload services. It provides truck services through dry and specialty vans of various sizes, unsided/platform trailers, temperature-controlled vans, and containers; rail intermodal services through contracts with domestic and Canadian railroads, certain short-line railroads, and asset-based intermodal equipment; and domestic and international air and ocean services. This segment serves the automotive parts and assemblies, consumer durables, building products, metals, chemicals, foodstuffs, heavy machinery, retail, electronics, and military equipment industries. The Insurance segment provides risk and claims management services; and reinsures risks of the company's independent contractors. It markets its services through independent commission sales agents and third party capacity providers. Landstar System, Inc. was incorporated in 1991 and is headquartered in Jacksonville, Florida.