Head-To-Head Survey: Universal Logistics (NASDAQ:ULH) versus Norfolk Southern (NYSE:NSC)

Norfolk Southern (NYSE:NSC) and Universal Logistics (NASDAQ:ULH) are both industrials companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, profitability, institutional ownership, dividends, analyst recommendations and valuation.

Institutional & Insider Ownership

75.1% of Norfolk Southern shares are owned by institutional investors. Comparatively, 25.5% of Universal Logistics shares are owned by institutional investors. 0.1% of Norfolk Southern shares are owned by insiders. Comparatively, 73.5% of Universal Logistics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Risk & Volatility

Norfolk Southern has a beta of 1.27, suggesting that its share price is 27% more volatile than the S&P 500. Comparatively, Universal Logistics has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500.

Profitability

This table compares Norfolk Southern and Universal Logistics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Norfolk Southern	21.02%	18.21%	6.34%
Universal Logistics	-3.16%	1.99%	0.62%

Analyst Recommendations

This is a summary of recent recommendations for Norfolk Southern and Universal Logistics, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Norfolk Southern	0	15	7	0	2.32
Universal Logistics	2	1	0	0	1.33

Norfolk Southern currently has a consensus price target of $348.00, suggesting a potential upside of 8.49%. Universal Logistics has a consensus price target of $15.00, suggesting a potential downside of 19.20%. Given Norfolk Southern’s stronger consensus rating and higher probable upside, analysts plainly believe Norfolk Southern is more favorable than Universal Logistics.

Dividends

Norfolk Southern pays an annual dividend of $5.40 per share and has a dividend yield of 1.7%. Universal Logistics pays an annual dividend of $0.42 per share and has a dividend yield of 2.3%. Norfolk Southern pays out 46.1% of its earnings in the form of a dividend. Universal Logistics pays out -22.8% 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. Universal Logistics is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Norfolk Southern and Universal Logistics”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Norfolk Southern	$12.18 billion	5.92	$2.87 billion	$11.72	27.37
Universal Logistics	$1.53 billion	0.32	-$99.87 million	($1.84)	-10.09

Norfolk Southern has higher revenue and earnings than Universal Logistics. Universal Logistics is trading at a lower price-to-earnings ratio than Norfolk Southern, indicating that it is currently the more affordable of the two stocks.

Summary

Norfolk Southern beats Universal Logistics on 13 of the 16 factors compared between the two stocks.

About Norfolk Southern

Norfolk Southern Corporation, together with its subsidiaries, engages in the rail transportation of raw materials, intermediate products, and finished goods in the United States. The company transports agriculture, forest, and consumer products comprising soybeans, wheat, corn, fertilizers, livestock and poultry feed, food products, food oils, flour, sweeteners, ethanol, lumber and wood products, pulp board and paper products, wood fibers, wood pulp, beverages, and canned goods; chemicals consist of sulfur and related chemicals, petroleum products comprising crude oil, chlorine and bleaching compounds, plastics, rubber, industrial chemicals, chemical wastes, sand, and natural gas liquids; metals and construction materials, such as steel, aluminum products, machinery, scrap metals, cement, aggregates, minerals, clay, transportation equipment, and military-related products; and automotive, including finished motor vehicles and automotive parts, as well as coal. It also transports overseas freight through various Atlantic and Gulf Coast ports; and operates an intermodal network. As of December 31, 2023, the company operated approximately 19,100 route miles in 22 states and the District of Columbia. Norfolk Southern Corporation was incorporated in 1980 and is headquartered in Atlanta, Georgia.

About Universal Logistics

Universal Logistics Holdings, Inc. provides transportation and logistics solutions in the United States, Mexico, Canada, and Colombia. The company offers truckload services, which include dry van, flatbed, heavy-haul, and refrigerated operations; domestic and international freight forwarding, and customs brokerage services. It transports various commodities comprising automotive parts, machinery, building materials, paper, food, consumer goods, furniture, steel, and other metals. The company also provides value-added services for individual customer requirements, including material handling, consolidation, sequencing, sub-assembly, cross-dock, kitting, repacking, warehousing, and returnable container management; and intermodal support services comprising short-to-medium distance delivery of steamship and rail truck containers between the port or railhead, and the customer. It serves automotive, steel, and other metals, retail and consumer goods, energy, and manufacturing industries, as well as other transportation companies who aggregate loads from various shippers. The company was formerly known as Universal Truckload Services, Inc. and changed its name to Universal Logistics Holdings, Inc. in April 2016. Universal Logistics Holdings, Inc. was founded in 1932 and is headquartered in Warren, Michigan.