Analyzing YRC Worldwide (YRCW) & Quality Distribution (QLTY)

YRC Worldwide (NASDAQ: YRCW) and Quality Distribution (NASDAQ:QLTY) are both small-cap transportation companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, valuation, risk, institutional ownership, dividends and analyst recommendations.

Insider and Institutional Ownership

86.5% of YRC Worldwide shares are held by institutional investors. 3.7% of YRC Worldwide shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings for YRC Worldwide and Quality Distribution, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
YRC Worldwide 0 2 2 0 2.50
Quality Distribution 0 0 0 0 N/A

YRC Worldwide presently has a consensus target price of $16.33, suggesting a potential upside of 50.96%. Given YRC Worldwide’s higher probable upside, equities analysts clearly believe YRC Worldwide is more favorable than Quality Distribution.

Valuation and Earnings

This table compares YRC Worldwide and Quality Distribution’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
YRC Worldwide $4.70 billion 0.08 $21.50 million ($0.35) -30.91
Quality Distribution N/A N/A N/A $0.38 42.05

YRC Worldwide has higher revenue and earnings than Quality Distribution. YRC Worldwide is trading at a lower price-to-earnings ratio than Quality Distribution, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

YRC Worldwide has a beta of 3.84, meaning that its stock price is 284% more volatile than the S&P 500. Comparatively, Quality Distribution has a beta of 2.83, meaning that its stock price is 183% more volatile than the S&P 500.

Profitability

This table compares YRC Worldwide and Quality Distribution’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
YRC Worldwide -0.22% -0.70% -0.22%
Quality Distribution 0.95% N/A 2.09%

Summary

YRC Worldwide beats Quality Distribution on 6 of the 10 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).

Quality Distribution Company Profile

Quality Distribution Inc. is a United States-based provider of bulk transportation and logistics services. The Company also provides transportation and delivery services. The Company offers services, such as chemical bulk transportation, logistics, container and depot, intermodal, leasing and risk services. Its container and depot services for intermodal equipment include repair, maintenance and cleaning, and redistribution. Its intermodal services include tracking solutions, solutions regarding capacity, pre-clearing for shipments moving across borders, and management and control over every shipping segment from departure to delivery. It offers risk management consulting that covers insurance policy reviews, insurance or self-insurance analysis and brokerage relationship studies. It also offers audit services, electronic or on-site. It serves industries, including chemical, unconventional oil and gas, bulk liquid and food grade liquid.

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