Canadian Pacific Kansas City (NYSE:CP) vs. Knight-Swift Transportation (NYSE:KNX) Financial Comparison

Knight-Swift Transportation (NYSE:KNX) and Canadian Pacific Kansas City (NYSE:CP) are both large-cap industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, dividends, risk and profitability.

Analyst Recommendations

This is a breakdown of current recommendations for Knight-Swift Transportation and Canadian Pacific Kansas City, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Knight-Swift Transportation	0	3	15	2	2.95
Canadian Pacific Kansas City	0	3	12	2	2.94

Knight-Swift Transportation currently has a consensus price target of $83.28, suggesting a potential upside of 29.11%. Canadian Pacific Kansas City has a consensus price target of $111.83, suggesting a potential upside of 32.30%. Given Canadian Pacific Kansas City’s higher probable upside, analysts clearly believe Canadian Pacific Kansas City is more favorable than Knight-Swift Transportation.

Profitability

This table compares Knight-Swift Transportation and Canadian Pacific Kansas City’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Knight-Swift Transportation	0.56%	3.51%	2.04%
Canadian Pacific Kansas City	25.02%	9.02%	4.86%

Insider and Institutional Ownership

88.8% of Knight-Swift Transportation shares are owned by institutional investors. Comparatively, 72.2% of Canadian Pacific Kansas City shares are owned by institutional investors. 2.9% of Knight-Swift Transportation 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 endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

Knight-Swift Transportation pays an annual dividend of $0.80 per share and has a dividend yield of 1.2%. Canadian Pacific Kansas City pays an annual dividend of $0.77 per share and has a dividend yield of 0.9%. Knight-Swift Transportation pays out 307.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Canadian Pacific Kansas City pays out 24.8% of its earnings in the form of a dividend. Knight-Swift Transportation has increased its dividend for 6 consecutive years. Knight-Swift Transportation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Knight-Swift Transportation has a beta of 1.21, indicating that its stock price is 21% more volatile than the S&P 500. Comparatively, Canadian Pacific Kansas City has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500.

Earnings and Valuation

This table compares Knight-Swift Transportation and Canadian Pacific Kansas City”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Knight-Swift Transportation	$7.47 billion	1.41	$65.95 million	$0.26	248.08
Canadian Pacific Kansas City	$10.79 billion	6.85	$2.96 billion	$3.11	27.18

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

Summary

Canadian Pacific Kansas City beats Knight-Swift Transportation on 9 of the 17 factors compared between the two stocks.

About Knight-Swift Transportation

Knight-Swift Transportation Holdings Inc., together with its subsidiaries, provides freight transportation services in the United States and Mexico. The company operates through four segments: Truckload, Less-than-truckload (LTL), Logistics, and Intermodal. The Truckload segment provides transportation services, which include irregular route and dedicated, refrigerated, expedited, flatbed, and cross-border operations. This segment operated an average of 20,948 tractors, which comprised 18,821 company tractors and 2,127 independent contractor tractors, as well as 87,865 trailers. The LTL segment provides regional LTL transportation services through a network of approximately 120 service centers; and offers national coverage through partner carrier outside the network. This segment operated an average of 3,201 tractors and 8,482 trailers. The Logistic segment offers brokerage and other freight management services through third-party transportation providers and equipment. The Intermodal segment offers transportation services, including freight through third-party intermodal rail services on trailing equipment, such as containers and trailers on flat cars; and drayage services. This segment operated an average of 639 tractors and 12,730 intermodal containers. The company also provides repair and maintenance shop, equipment leasing, warranty, and insurance services; and warehousing and driving academy services, as well as manufactures trailer parts. It serves retail, food and beverage, consumer and paper products, transportation and logistics, housing, and building, automotive, and manufacturing industries. Knight-Swift Transportation Holdings Inc. was incorporated in 1989 and is headquartered in Phoenix, Arizona.

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.