Macquarie Infrastructure (NYSE: MIC) and Roadrunner Transportation Systems (NYSE:RRTS) are both large-cap multi-sector conglomerates companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, valuation, institutional ownership, analyst recommendations, earnings, risk and dividends.

Institutional and Insider Ownership

80.9% of Macquarie Infrastructure shares are held by institutional investors. Comparatively, 71.6% of Roadrunner Transportation Systems shares are held by institutional investors. 5.9% of Macquarie Infrastructure shares are held by insiders. Comparatively, 25.8% of Roadrunner Transportation Systems shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility and Risk

Macquarie Infrastructure has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Roadrunner Transportation Systems has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Macquarie Infrastructure and Roadrunner Transportation Systems, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Macquarie Infrastructure 0 1 3 0 2.75
Roadrunner Transportation Systems 0 1 1 0 2.50

Macquarie Infrastructure currently has a consensus price target of $89.33, indicating a potential upside of 30.89%. Roadrunner Transportation Systems has a consensus price target of $10.00, indicating a potential upside of 19.47%. Given Macquarie Infrastructure’s stronger consensus rating and higher probable upside, research analysts clearly believe Macquarie Infrastructure is more favorable than Roadrunner Transportation Systems.

Valuation & Earnings

This table compares Macquarie Infrastructure and Roadrunner Transportation Systems’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Macquarie Infrastructure $1.65 billion 3.49 $156.38 million $2.13 32.04
Roadrunner Transportation Systems $2.00 billion 0.16 $48.00 million $0.66 12.68

Macquarie Infrastructure has higher revenue, but lower earnings than Roadrunner Transportation Systems. Roadrunner Transportation Systems is trading at a lower price-to-earnings ratio than Macquarie Infrastructure, indicating that it is currently the more affordable of the two stocks.

Dividends

Macquarie Infrastructure pays an annual dividend of $5.52 per share and has a dividend yield of 8.1%. Roadrunner Transportation Systems does not pay a dividend. Macquarie Infrastructure pays out 259.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Macquarie Infrastructure has raised its dividend for 5 consecutive years.

Profitability

This table compares Macquarie Infrastructure and Roadrunner Transportation Systems’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Macquarie Infrastructure 9.82% 5.66% 2.28%
Roadrunner Transportation Systems N/A N/A N/A

Summary

Macquarie Infrastructure beats Roadrunner Transportation Systems on 13 of the 17 factors compared between the two stocks.

Macquarie Infrastructure Company Profile

Macquarie Infrastructure Corporation owns and operates a group of businesses that provide services, such as bulk liquid terminalling and handling services. The Company operates through four segments: International-Matex Tank Terminals (IMTT), Atlantic Aviation, Contracted Power (CP) and MIC Hawaii. Its group of businesses also provides services, such as aircraft fueling, CP generation and utility gas services. Its group of businesses provides services to businesses, government agencies and individuals in the United States. IMTT segment provides bulk liquid terminal services in the United States. As of December 31, 2016, Atlantic Aviation operated Fixed based operations (FBOs) at 69 airports in the United States. The businesses in its CP segment sell electricity to off-takers, pursuant to multi-year contracts. MIC Hawaii segment consists of Hawaii Gas and several smaller businesses. Hawaii Gas consists of a gas utility and a liquefied petroleum gas (LPG) distribution business.

Roadrunner Transportation Systems Company Profile

Roadrunner Transportation Systems, Inc. (RRTS) is an asset-light transportation and logistics service provider. The Company offers a suite of global supply chain solutions, including truckload logistics (TL), customized and expedited less-than-truckload (LTL), intermodal solutions (transporting a shipment by over one mode, primarily through rail and truck), freight consolidation, inventory management, expedited services, air freight, international freight forwarding, customs brokerage and transportation management solutions. The Company operates through three segments: Truckload Logistics, Less-than-Truckload and Global Solutions. The Company utilizes a third-party network of transportation providers, consisting of independent contractors (ICs) and purchased power providers, to serve a diverse customer base. It primarily focuses on small to mid-size shippers.

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