Old Dominion Freight Line (NASDAQ: ODFL) and P.A.M. Transportation Services (NASDAQ:PTSI) are both transportation companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, profitabiliy, risk, valuation and analyst recommendations.
Volatility & Risk
Old Dominion Freight Line has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500. Comparatively, P.A.M. Transportation Services has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500.
Institutional & Insider Ownership
74.9% of Old Dominion Freight Line shares are owned by institutional investors. Comparatively, 28.3% of P.A.M. Transportation Services shares are owned by institutional investors. 12.0% of Old Dominion Freight Line shares are owned by insiders. Comparatively, 62.0% of P.A.M. Transportation Services shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares Old Dominion Freight Line and P.A.M. Transportation Services’ gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Old Dominion Freight Line | $3.12 billion | 2.54 | $718.59 million | $3.85 | 24.99 |
| P.A.M. Transportation Services | $435.80 million | 0.26 | $50.79 million | $1.25 | 14.08 |
Old Dominion Freight Line has higher revenue and earnings than P.A.M. Transportation Services. P.A.M. Transportation Services is trading at a lower price-to-earnings ratio than Old Dominion Freight Line, indicating that it is currently the more affordable of the two stocks.
Dividends
Old Dominion Freight Line pays an annual dividend of $0.40 per share and has a dividend yield of 0.4%. P.A.M. Transportation Services does not pay a dividend. Old Dominion Freight Line pays out 10.4% of its earnings in the form of a dividend.
Profitability
This table compares Old Dominion Freight Line and P.A.M. Transportation Services’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Old Dominion Freight Line | 10.19% | 16.87% | 11.61% |
| P.A.M. Transportation Services | 1.85% | 8.57% | 2.15% |
Analyst Ratings
This is a breakdown of current recommendations for Old Dominion Freight Line and P.A.M. Transportation Services, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Old Dominion Freight Line | 0 | 5 | 3 | 0 | 2.38 |
| P.A.M. Transportation Services | 0 | 1 | 0 | 0 | 2.00 |
Old Dominion Freight Line currently has a consensus target price of $96.13, suggesting a potential downside of 0.10%. P.A.M. Transportation Services has a consensus target price of $17.00, suggesting a potential downside of 3.41%. Given Old Dominion Freight Line’s stronger consensus rating and higher possible upside, research analysts plainly believe Old Dominion Freight Line is more favorable than P.A.M. Transportation Services.
Summary
Old Dominion Freight Line beats P.A.M. Transportation Services on 14 of the 16 factors compared between the two stocks.
About Old Dominion Freight Line
Old Dominion Freight Line, Inc. is a union-free motor carrier providing regional, inter-regional and national less-than-truckload (LTL) services. The Company’s LTL services include ground and air expedited transportation for time-sensitive shipments, consumer household pickup and delivery and freight delivery services throughout North America. In addition to its LTL services, the Company offers a range of other value-added services that include container drayage, truckload brokerage, supply chain consulting and warehousing. As of December 31, 2016, the Company operated 226 service center locations, of which it owned 182 and leased 44. As of December 31, 2016, its network included 10 breakbulk facilities located in Rialto, California; Atlanta, Georgia; Columbus, Ohio; Indianapolis, Indiana; Greensboro, North Carolina; Harrisburg, Pennsylvania; Memphis and Morristown, Tennessee; Dallas, Texas, and Salt Lake City, Utah. As of December 31, 2016, the Company owned 7,994 tractors.
About P.A.M. Transportation Services
P.A.M. Transportation Services, Inc. is a holding company. The Company, through its subsidiaries, operates as a truckload transportation and logistics company. It operates in the motor carrier segment. It operates as a truckload dry van carrier transporting general commodities throughout the continental United States, as well as in certain Canadian provinces. It provides transportation services in Mexico under agreements with Mexican carriers. Its operations are classified into truckload services, or brokerage and logistics services. Truckload services include transportation services, in which it utilizes company owned trucks or independent operator owned trucks for the pickup and delivery of freight. The brokerage and logistics services consist of services, such as transportation scheduling, routing, mode selection, transloading and other services related to the transportation of freight, which may or may not involve the use of company owned or independent operator owned equipment.
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