Analyzing Core-Mark Holding (CORE) & Echo Global Logistics (NASDAQ:ECHO)

Core-Mark Holding (NASDAQ: CORE) and Echo Global Logistics (NASDAQ:ECHO) are both small-cap business services companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.

Dividends

Core-Mark Holding pays an annual dividend of $0.36 per share and has a dividend yield of 1.3%. Echo Global Logistics does not pay a dividend. Core-Mark Holding pays out 40.0% of its earnings in the form of a dividend.

Valuation & Earnings

This table compares Core-Mark Holding and Echo Global Logistics’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Core-Mark Holding $11.83 billion 0.11 $117.80 million $0.90 31.09
Echo Global Logistics $1.75 billion 0.23 $31.70 million ($0.13) -106.91

Core-Mark Holding has higher revenue and earnings than Echo Global Logistics. Echo Global Logistics is trading at a lower price-to-earnings ratio than Core-Mark Holding, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Core-Mark Holding and Echo Global Logistics’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Core-Mark Holding 0.27% 9.70% 3.56%
Echo Global Logistics -0.21% 3.22% 1.47%

Volatility and Risk

Core-Mark Holding has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Echo Global Logistics has a beta of 1.39, indicating that its stock price is 39% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Core-Mark Holding and Echo Global Logistics, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Core-Mark Holding 0 1 3 0 2.75
Echo Global Logistics 0 3 5 0 2.63

Core-Mark Holding currently has a consensus price target of $39.50, indicating a potential upside of 41.17%. Echo Global Logistics has a consensus price target of $21.33, indicating a potential upside of 53.48%. Given Echo Global Logistics’ higher possible upside, analysts clearly believe Echo Global Logistics is more favorable than Core-Mark Holding.

Insider & Institutional Ownership

98.3% of Core-Mark Holding shares are held by institutional investors. Comparatively, 90.7% of Echo Global Logistics shares are held by institutional investors. 2.4% of Core-Mark Holding shares are held by company insiders. Comparatively, 8.1% of Echo Global Logistics shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Core-Mark Holding beats Echo Global Logistics on 9 of the 16 factors compared between the two stocks.

Core-Mark Holding Company Profile

Core-Mark Holding Company, Inc. is a wholesale distributor to the convenience retail industry in North America. The Company provides sales, marketing, distribution and logistics services. As of December 31, 2016, the Company offered services to over 43,000 customer locations across the United States and Canada through 30 distribution centers. The Company’s segments include the United States, Canada and Corporate. The Company’s primary customer base consists of traditional convenience stores, as well as alternative outlets selling consumer packaged goods. The Company’s traditional convenience store customers include various national and super-regional convenience store operators, as well as independently owned convenience stores. Its alternative outlet customers include a range of store formats, including grocery stores, drug stores, liquor stores, cigarette and tobacco shops, hotel gift shops, military exchanges, college and corporate campuses, casinos and hardware stores.

Echo Global Logistics Company Profile

Echo Global Logistics, Inc. is a provider of technology-enabled transportation and supply chain management solutions. The Company utilizes a technology platform to compile and analyze data from its multi-modal network of transportation providers to facilitate its transportation and logistics services. The Company focuses primarily on arranging transportation by truckload (TL) and less than truckload (LTL) carriers. It also offers intermodal (which involves moving a shipment by rail and truck), small parcel, domestic air, expedited and international transportation services. The Company’s core logistics services include rate negotiation, shipment execution and tracking, carrier selection and management, routing compliance freight bill payment and audit, payment and performance management and reporting functions.

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