Old Dominion Freight Line (NASDAQ: ODFL) and Celadon Group (NYSE:CGI) are both transportation companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, institutional ownership, risk, earnings, analyst recommendations, dividends and profitability.

Insider & Institutional Ownership

73.8% of Old Dominion Freight Line shares are owned by institutional investors. Comparatively, 85.2% of Celadon Group shares are owned by institutional investors. 12.0% of Old Dominion Freight Line shares are owned by insiders. Comparatively, 3.8% of Celadon Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Old Dominion Freight Line and Celadon Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Old Dominion Freight Line 10.19% 16.87% 11.61%
Celadon Group 0.50% 1.41% 0.49%

Earnings & Valuation

This table compares Old Dominion Freight Line and Celadon Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Old Dominion Freight Line $3.12 billion 2.91 $718.76 million $3.85 28.60
Celadon Group $1.05 billion 0.18 $83.46 million $0.20 33.75

Old Dominion Freight Line has higher revenue and earnings than Celadon Group. Old Dominion Freight Line is trading at a lower price-to-earnings ratio than Celadon Group, indicating that it is currently the more affordable of the two stocks.

Dividends

Old Dominion Freight Line pays an annual dividend of $0.40 per share and has a dividend yield of 0.4%. Celadon Group pays an annual dividend of $0.06 per share and has a dividend yield of 0.9%. Old Dominion Freight Line pays out 10.4% of its earnings in the form of a dividend. Celadon Group pays out 30.0% 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.

Volatility and Risk

Old Dominion Freight Line has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500. Comparatively, Celadon Group has a beta of 1.68, meaning that its share price is 68% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for Old Dominion Freight Line and Celadon Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Old Dominion Freight Line 0 6 3 0 2.33
Celadon Group 0 3 4 0 2.57

Old Dominion Freight Line currently has a consensus price target of $98.00, indicating a potential downside of 11.00%. Celadon Group has a consensus price target of $25.50, indicating a potential upside of 277.78%. Given Celadon Group’s stronger consensus rating and higher probable upside, analysts plainly believe Celadon Group is more favorable than Old Dominion Freight Line.

Summary

Old Dominion Freight Line beats Celadon Group on 9 of the 16 factors compared between the two stocks.

Old Dominion Freight Line Company Profile

Old Dominion Freight Line, Inc. is a union-free motor carrier providing regional, inter-regional and national less-than-truckload (LTL) services. The Company’s LTL services include ground and air expedited transportation for time-sensitive shipments, consumer household pickup and delivery and freight delivery services throughout North America. In addition to its LTL services, the Company offers a range of other value-added services that include container drayage, truckload brokerage, supply chain consulting and warehousing. As of December 31, 2016, the Company operated 226 service center locations, of which it owned 182 and leased 44. As of December 31, 2016, its network included 10 breakbulk facilities located in Rialto, California; Atlanta, Georgia; Columbus, Ohio; Indianapolis, Indiana; Greensboro, North Carolina; Harrisburg, Pennsylvania; Memphis and Morristown, Tennessee; Dallas, Texas, and Salt Lake City, Utah. As of December 31, 2016, the Company owned 7,994 tractors.

Celadon Group Company Profile

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 and refrigerated; 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.

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