Head-To-Head Review: YRC Worldwide (YRCW) & Canadian National Railway (CNI)
YRC Worldwide (NASDAQ: YRCW) and Canadian National Railway (NYSE:CNI) are both transportation companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, earnings, risk, dividends, valuation, analyst recommendations and profitability.
Canadian National Railway pays an annual dividend of $1.22 per share and has a dividend yield of 1.5%. YRC Worldwide does not pay a dividend. Canadian National Railway pays out 31.8% of its earnings in the form of a dividend. YRC Worldwide has increased its dividend for 5 consecutive years.
Institutional & Insider Ownership
87.5% of YRC Worldwide shares are held by institutional investors. Comparatively, 55.6% of Canadian National Railway shares are held by institutional investors. 3.7% of YRC Worldwide shares are held by insiders. Comparatively, 2.4% of Canadian National Railway shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Valuation and Earnings
This table compares YRC Worldwide and Canadian National Railway’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|YRC Worldwide||$4.80 billion||0.08||$254.10 million||($0.02)||-589.71|
|Canadian National Railway||$10.17 billion||5.87||$5.48 billion||$3.84||20.70|
Canadian National Railway has higher revenue and earnings than YRC Worldwide. YRC Worldwide is trading at a lower price-to-earnings ratio than Canadian National Railway, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent recommendations for YRC Worldwide and Canadian National Railway, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Canadian National Railway||0||13||5||0||2.28|
YRC Worldwide currently has a consensus price target of $16.33, suggesting a potential upside of 38.42%. Canadian National Railway has a consensus price target of $81.36, suggesting a potential upside of 2.34%. Given YRC Worldwide’s stronger consensus rating and higher possible upside, equities analysts clearly believe YRC Worldwide is more favorable than Canadian National Railway.
Risk and Volatility
YRC Worldwide has a beta of 3.74, suggesting that its stock price is 274% more volatile than the S&P 500. Comparatively, Canadian National Railway has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500.
This table compares YRC Worldwide and Canadian National Railway’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Canadian National Railway||30.59%||25.42%||10.24%|
Canadian National Railway beats YRC Worldwide on 9 of the 17 factors compared between the two stocks.
YRC Worldwide Company Profile
YRC Worldwide Inc. is a holding company. The Company, through its subsidiaries, offers its customers a range of transportation services. The Company operates through two segments: YRC Freight and Regional Transportation. The Company has less-than-truckload (LTL) networks in North America with local, regional, national and international capabilities. YRC Freight segment offers a range of services for the transportation of industrial, commercial and retail goods in national, regional and international markets, primarily through the operation of owned or leased equipment in its North American ground distribution network. It provides transportation services for various categories of goods, which include apparel, appliances, automotive parts, chemicals, food, furniture, glass, machinery, metal and metal products. The Company’s Regional Transportation segment consists of USF Holland LLC (Holland), New Penn Motor Express, LLC (New Penn) and USF Reddaway Inc. (Reddaway).
Canadian National Railway Company Profile
Canadian National Railway Company is engaged in the rail and related transportation business. The Company’s network of approximately 20,000 route miles of track spans Canada and mid-America, connecting approximately three coasts, including the Atlantic, the Pacific and the Gulf of Mexico and serving the cities and ports of Vancouver, Prince Rupert (British Columbia), Montreal, Halifax, New Orleans, and Mobile (Alabama), and the metropolitan areas of Toronto, Edmonton, Winnipeg, Calgary, Chicago, Memphis, Detroit, Duluth (Minnesota)/Superior (Wisconsin), and Jackson (Mississippi), with connections to all points in North America. Its network and connections to all Class I railroads provide its customers access to the three North American Free Trade Agreement nations. It carries over 300 million tons of cargo, serving exporters, importers, retailers, farmers and manufacturers. Its freight includes seven commodity representing a portfolio of goods.
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