Contrasting Daseke (NASDAQ:DSKE) and Covenant Logistics Group (NASDAQ:CVLG)

Daseke (NASDAQ:DSKE) and Covenant Logistics Group (NASDAQ:CVLG) are both small-cap industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.

Valuation & Earnings

This table compares Daseke and Covenant Logistics Group’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Daseke	$1.57 billion	0.25	-$17.70 million	($0.59)	-14.05
Covenant Logistics Group	$1.10 billion	0.52	$55.23 million	$4.03	10.84

Covenant Logistics Group has lower revenue, but higher earnings than Daseke. Daseke is trading at a lower price-to-earnings ratio than Covenant Logistics Group, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

71.5% of Daseke shares are owned by institutional investors. Comparatively, 83.7% of Covenant Logistics Group shares are owned by institutional investors. 5.8% of Daseke shares are owned by insiders. Comparatively, 29.1% of Covenant Logistics Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings for Daseke and Covenant Logistics Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Daseke	0	1	1	0	2.50
Covenant Logistics Group	0	0	3	0	3.00

Daseke currently has a consensus target price of $10.15, indicating a potential upside of 22.44%. Covenant Logistics Group has a consensus target price of $68.67, indicating a potential upside of 57.17%. Given Covenant Logistics Group’s stronger consensus rating and higher probable upside, analysts plainly believe Covenant Logistics Group is more favorable than Daseke.

Volatility and Risk

Daseke has a beta of 2, meaning that its stock price is 100% more volatile than the S&P 500. Comparatively, Covenant Logistics Group has a beta of 1.41, meaning that its stock price is 41% more volatile than the S&P 500.

Profitability

This table compares Daseke and Covenant Logistics Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Daseke	-1.13%	-30.76%	-1.51%
Covenant Logistics Group	4.98%	14.85%	6.60%

Summary

Covenant Logistics Group beats Daseke on 12 of the 14 factors compared between the two stocks.

About Daseke

Daseke, Inc. provides transportation and logistics solutions in the United States, Canada, and Mexico. It operates in two segments, Flatbed Solutions and Specialized Solutions. The company transports aircraft parts, manufacturing equipment, structural steel, pressure vessels, wind turbine blades, commercial glass, high security cargo, industrial and hazardous waste, arms, ammunition and explosives, lumber, and building and construction materials, as well as heavy machinery, such as construction, mining, and agriculture. It also offers logistical planning and warehousing services. As of December 31, 2023, the company operated 2,971 company-owned tractors and 1,798 independent owned and operated contractors tractors; and 9,669 trailers. Daseke, Inc. is headquartered in Addison, Texas.

About Covenant Logistics Group

Covenant Logistics Group, Inc., together with its subsidiaries, provides transportation and logistics services in the United States. It operates through four segments: Expedited, Dedicated, Managed Freight, and Warehousing. The Expedited segment primarily provides truckload services with high service freight and delivery standards, such as 1,000 miles in 22 hours or 15-minute delivery windows. Its Dedicated segment provides customers with committed truckload capacity over contracted periods with the goal of three to five years in length using equipment either owned or leased by the company. The Managed Freight segment offers brokerage services, including logistics capacity by outsourcing the carriage of customers' freight to third parties; and transport management services, such as logistics services on a contractual basis to customers who prefer to outsource their logistics needs. Its Warehousing segment provides day-to-day warehouse management services to customers, as well as shuttle and switching services related to shuttling containers and trailers. The company also engages in used equipment sales and leasing business. It serves transportation companies, such as parcel freight forwarders, less-than-truckload carriers, and third-party logistics providers; and traditional truckload customers, including manufacturers, retailers, and food and beverage shippers. The company was formerly known as Covenant Transportation Group, Inc. and changed its name to Covenant Logistics Group, Inc. in July 2020. Covenant Logistics Group, Inc. was founded in 1986 and is based in Chattanooga, Tennessee.