Contrasting J.B. Hunt Transport Services (NASDAQ:JBHT) & Canadian National Railway (NYSE:CNI)

J.B. Hunt Transport Services (NASDAQ:JBHT) and Canadian National Railway (NYSE:CNI) are both large-cap industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, dividends, profitability, institutional ownership and valuation.

Institutional and Insider Ownership

75.0% of J.B. Hunt Transport Services shares are held by institutional investors. Comparatively, 80.7% of Canadian National Railway shares are held by institutional investors. 2.5% of J.B. Hunt Transport Services shares are held by company insiders. Comparatively, 2.4% of Canadian National Railway shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares J.B. Hunt Transport Services and Canadian National Railway’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
J.B. Hunt Transport Services	5.31%	18.75%	8.46%
Canadian National Railway	26.92%	22.22%	8.12%

Earnings & Valuation

This table compares J.B. Hunt Transport Services and Canadian National Railway”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
J.B. Hunt Transport Services	$12.00 billion	2.12	$598.28 million	$7.06	38.31
Canadian National Railway	$12.38 billion	5.98	$3.38 billion	$5.64	21.69

Canadian National Railway has higher revenue and earnings than J.B. Hunt Transport Services. Canadian National Railway is trading at a lower price-to-earnings ratio than J.B. Hunt Transport Services, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

J.B. Hunt Transport Services has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500. Comparatively, Canadian National Railway has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500.

Dividends

J.B. Hunt Transport Services pays an annual dividend of $1.80 per share and has a dividend yield of 0.7%. Canadian National Railway pays an annual dividend of $2.60 per share and has a dividend yield of 2.1%. J.B. Hunt Transport Services pays out 25.5% of its earnings in the form of a dividend. Canadian National Railway pays out 46.1% 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. J.B. Hunt Transport Services has raised its dividend for 22 consecutive years and Canadian National Railway has raised its dividend for 3 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for J.B. Hunt Transport Services and Canadian National Railway, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
J.B. Hunt Transport Services	1	10	13	2	2.62
Canadian National Railway	0	9	9	0	2.50

J.B. Hunt Transport Services currently has a consensus target price of $286.30, indicating a potential upside of 5.86%. Canadian National Railway has a consensus target price of $137.40, indicating a potential upside of 12.30%. Given Canadian National Railway’s higher possible upside, analysts plainly believe Canadian National Railway is more favorable than J.B. Hunt Transport Services.

Summary

J.B. Hunt Transport Services beats Canadian National Railway on 10 of the 18 factors compared between the two stocks.

About J.B. Hunt Transport Services

J.B. Hunt Transport Services, Inc. provides surface transportation, delivery, and logistic services in the United States. It operates through five segments: Intermodal (JBI), Dedicated Contract Services (DCS), Integrated Capacity Solutions (ICS), Final Mile Services (FMS), and Truckload (JBT). The JBI segment offers intermodal freight solutions. It operates 118,171 pieces of company-owned trailing equipment; owns and maintains its chassis fleet of 100,825 units; and manages a fleet of 5,944 company-owned tractors, 436 independent contractor trucks, and 7,567 company drivers. The DCS segment designs, develops, and executes supply chain solutions that support various transportation networks. As of December 31, 2023, it operated 12,574 company-owned trucks, 674 customer-owned trucks, and 4 contractor trucks. The company also operates 27,194 owned pieces of trailing equipment and 5,406 customer-owned trailers. The ICS segment provides freight brokerage and transportation logistics solutions; flatbed, refrigerated, expedited, and less-than-truckload, as well as dry-van and intermodal solutions; online multimodal marketplace; and logistics management for customers to outsource their transportation functions. The FMS segment offers delivery services through 1,166 company-owned trucks, 225 customer-owned trucks, and 20 independent contractor trucks; and 1,212 owned pieces of trailing equipment and 102 customer-owned trailers. The JBT segment provides dry-van freight services by utilizing tractors and trailers operating over roads and highways through 27 company-owned tractors and 13,561 company-owned trailers. It also transports or arranges for the transportation of freight, such as general merchandise, specialty consumer items, appliances, forest and paper products, food and beverages, building materials, soaps and cosmetics, automotive parts, agricultural products, electronics, and chemicals. The company was incorporated in 1961 and is headquartered in Lowell, Arkansas.

About Canadian National Railway

Canadian National Railway Company, together with its subsidiaries, engages in the rail, intermodal, trucking, and marine transportation and logistics business in Canada and the United States. The company provides rail services, which include equipment, custom brokerage services, transloading and distribution, business development and real estate, and private car storage services; and intermodal services, such as temperature controlled cargo, port partnerships, and logistics parks. It offers trucking services, such as door-to-door services, import and export dray, interline services, and specialized services, comprising flatbed trucks, on-deck mobile transport trays, expedited cargo, and permit/overweight services; and supply chain services. It serves automotive, coal, fertilizers, temperature controlled cargo, forest products, dimensional, grain, metal and minerals, petroleum and chemicals, consumer goods, and third party logistics applications. The company operates a rail network of approximately 20,000 route-miles of track and shipping spanning. Canadian National Railway Company was incorporated in 1919 and is headquartered in Montreal, Canada.