Canadian Pacific Kansas City (NYSE:CP) versus Universal Logistics (NASDAQ:ULH) Critical Contrast

Universal Logistics (NASDAQ:ULH) and Canadian Pacific Kansas City (NYSE:CP) are both industrials companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, analyst recommendations, valuation, profitability, earnings and dividends.

Profitability

This table compares Universal Logistics and Canadian Pacific Kansas City’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Universal Logistics	-3.16%	1.99%	0.62%
Canadian Pacific Kansas City	25.02%	9.02%	4.86%

Risk & Volatility

Universal Logistics has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500. Comparatively, Canadian Pacific Kansas City has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Universal Logistics and Canadian Pacific Kansas City, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Universal Logistics	1	2	0	0	1.67
Canadian Pacific Kansas City	0	3	11	1	2.87

Universal Logistics currently has a consensus price target of $15.00, indicating a potential downside of 10.13%. Canadian Pacific Kansas City has a consensus price target of $108.60, indicating a potential upside of 24.94%. Given Canadian Pacific Kansas City’s stronger consensus rating and higher probable upside, analysts clearly believe Canadian Pacific Kansas City is more favorable than Universal Logistics.

Valuation & Earnings

This table compares Universal Logistics and Canadian Pacific Kansas City”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Universal Logistics	$1.53 billion	0.29	-$99.87 million	($1.84)	-9.07
Canadian Pacific Kansas City	$10.79 billion	7.08	$2.96 billion	$3.11	27.95

Canadian Pacific Kansas City has higher revenue and earnings than Universal Logistics. Universal Logistics is trading at a lower price-to-earnings ratio than Canadian Pacific Kansas City, indicating that it is currently the more affordable of the two stocks.

Dividends

Universal Logistics pays an annual dividend of $0.42 per share and has a dividend yield of 2.5%. Canadian Pacific Kansas City pays an annual dividend of $0.78 per share and has a dividend yield of 0.9%. Universal Logistics pays out -22.8% of its earnings in the form of a dividend. Canadian Pacific Kansas City pays out 25.1% 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. Universal Logistics is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

25.5% of Universal Logistics shares are owned by institutional investors. Comparatively, 72.2% of Canadian Pacific Kansas City shares are owned by institutional investors. 73.5% of Universal Logistics shares are owned by insiders. Comparatively, 0.0% of Canadian Pacific Kansas City shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Canadian Pacific Kansas City beats Universal Logistics on 14 of the 17 factors compared between the two stocks.

About Universal Logistics

Universal Logistics Holdings, Inc. provides transportation and logistics solutions in the United States, Mexico, Canada, and Colombia. The company offers truckload services, which include dry van, flatbed, heavy-haul, and refrigerated operations; domestic and international freight forwarding, and customs brokerage services. It transports various commodities comprising automotive parts, machinery, building materials, paper, food, consumer goods, furniture, steel, and other metals. The company also provides value-added services for individual customer requirements, including material handling, consolidation, sequencing, sub-assembly, cross-dock, kitting, repacking, warehousing, and returnable container management; and intermodal support services comprising short-to-medium distance delivery of steamship and rail truck containers between the port or railhead, and the customer. It serves automotive, steel, and other metals, retail and consumer goods, energy, and manufacturing industries, as well as other transportation companies who aggregate loads from various shippers. The company was formerly known as Universal Truckload Services, Inc. and changed its name to Universal Logistics Holdings, Inc. in April 2016. Universal Logistics Holdings, Inc. was founded in 1932 and is headquartered in Warren, Michigan.

About Canadian Pacific Kansas City

Canadian Pacific Kansas City Limited, together with its subsidiaries, owns and operates a transcontinental freight railway in Canada, the United States, and Mexico. The company transports bulk commodities, including grain, coal, potash, fertilizers, and sulphur; merchandise freight, such as forest products, energy, chemicals and plastics, metals, minerals, consumer products, and automotive; and intermodal traffic comprising retail goods in overseas containers. It also provides rail and intermodal transportation services over a network of approximately 20,000 miles serving business centres. The company was formerly known as Canadian Pacific Railway Limited and changed its name to Canadian Pacific Kansas City Limited in April 2023. Canadian Pacific Kansas City Limited was incorporated in 1881 and is headquartered in Calgary, Canada.