Hub Group (NASDAQ:HUBG) and WEST JAPAN Rwy/S (OTCMKTS:WJRYY) are both transportation companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, analyst recommendations, valuation, profitability, earnings and risk.
Risk & Volatility
Hub Group has a beta of 1.43, indicating that its share price is 43% more volatile than the S&P 500. Comparatively, WEST JAPAN Rwy/S has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500.
WEST JAPAN Rwy/S pays an annual dividend of $0.56 per share and has a dividend yield of 0.8%. Hub Group does not pay a dividend. WEST JAPAN Rwy/S pays out 10.2% of its earnings in the form of a dividend.
Valuation and Earnings
This table compares Hub Group and WEST JAPAN Rwy/S’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Hub Group||$4.03 billion||0.40||$135.15 million||$1.91||24.38|
|WEST JAPAN Rwy/S||$13.55 billion||0.97||$1.04 billion||$5.48||12.44|
WEST JAPAN Rwy/S has higher revenue and earnings than Hub Group. WEST JAPAN Rwy/S is trading at a lower price-to-earnings ratio than Hub Group, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings and price targets for Hub Group and WEST JAPAN Rwy/S, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|WEST JAPAN Rwy/S||0||0||0||0||N/A|
Hub Group currently has a consensus target price of $56.82, suggesting a potential upside of 22.03%. Given Hub Group’s higher probable upside, analysts clearly believe Hub Group is more favorable than WEST JAPAN Rwy/S.
Insider and Institutional Ownership
91.3% of Hub Group shares are held by institutional investors. Comparatively, 0.2% of WEST JAPAN Rwy/S shares are held by institutional investors. 5.8% of Hub Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares Hub Group and WEST JAPAN Rwy/S’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|WEST JAPAN Rwy/S||7.53%||11.04%||4.03%|
Hub Group beats WEST JAPAN Rwy/S on 8 of the 15 factors compared between the two stocks.
Hub Group Company Profile
Hub Group, Inc., an asset-light freight transportation management company, provides intermodal, truck brokerage, and logistics services in North America. It operates through two segments, Mode and Hub. Its intermodal services include arranging for the movement of its customers' freight in containers and trailers over long distances. The company contracts with railroads to provide transportation for the long-haul portion of the shipment and with local trucking companies for pickup and delivery. Its intermodal services also comprise negotiating rail and drayage rates, electronically tracking shipments in transit, and consolidate billing and handling claims for freight loss or damage on behalf of customers. In addition, the company offers truck brokerage services, as well as a range of transportation management services and technology solutions, including shipment optimization, load consolidation, mode selection, carrier management, load planning and execution, and Web-based shipment visibility under the Unyson Logistics name. Further, it provides multi-modal transportation services, such as small parcel, heavyweight, expedited, less-than-truckload, truckload, intermodal, railcar, and international shipping. As of December 31, 2017, the company owned a total of 32,000 53-foot private containers, as well as access to approximately 2,500 rail-owned containers for use on the Union Pacific and the Norfolk Southern rails. Hub Group, Inc. was founded in 1971 and is headquartered in Oak Brook, Illinois.
WEST JAPAN Rwy/S Company Profile
West Japan Railway Company provides passenger railway transport services in Japan. The company operates through Transportation Operations, Retail Business, Real Estate Business, and Other Businesses segments. It operates a railway network that stretches across an area of approximately 104,000 square kilometers covering 18 prefectures in western Honshu and the northern tip of Kyushu comprising a total of 1,200 railway stations with an operating route length of 5,008.7 kilometers. The company also operates high-speed intercity passenger service between Shin-Osaka station in Osaka and Hakata station in Fukuoka in northern Kyushu; and high-speed intercity passenger service between Tokyo and Kanazawa stations. In addition, its urban network offers service to the KyotoOsakaKobe metropolitan area with an operating route length of 946.0 kilometers. Further, the company operates other conventional lines with an operating route length of 3,250.1 kilometers comprising intercity transport provided by limited express and express services; regional transport for commuters and students in and around regional hub cities, such as Hiroshima and Okayama; and local lines with low transport density, as well as TWILIGHT EXPRESS MIZUKAZE, a sleeper train to invigorate the West Japan Area. Additionally, it offers bus and ferry services; operates convenience stores, department stores, specialty stores, food and beverage outlets, and tourism campaigns; and provides travel agency, advertising agency, hotel, maintenance and engineering, and other services. The company is also involved in the sale and leasing of residential and urban development properties; management of shopping centers in station buildings and other facilities; operation of large station buildings at hub railway stations; and development of commercial facilities near railway station areas and underneath elevated tracks. West Japan Railway Company was founded in 1987 and is headquartered in Osaka, Japan.
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