Critical Analysis: Heartland Express (NASDAQ:HTLD) and Pamt (NASDAQ:PAMT)

Heartland Express (NASDAQ:HTLD) and Pamt (NASDAQ:PAMT) are both small-cap transportation companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, earnings, valuation, risk, profitability and dividends.

Insider and Institutional Ownership

53.5% of Heartland Express shares are held by institutional investors. Comparatively, 22.1% of Pamt shares are held by institutional investors. 39.6% of Heartland Express shares are held by insiders. Comparatively, 27.2% of Pamt shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

Heartland Express has a beta of 0.8, indicating that its share price is 20% less volatile than the S&P 500. Comparatively, Pamt has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Heartland Express and Pamt, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Heartland Express	2	1	0	0	1.33
Pamt	0	1	0	0	2.00

Heartland Express presently has a consensus price target of $11.00, indicating a potential upside of 17.15%. Pamt has a consensus price target of $16.50, indicating a potential upside of 34.80%. Given Pamt’s stronger consensus rating and higher probable upside, analysts plainly believe Pamt is more favorable than Heartland Express.

Valuation and Earnings

This table compares Heartland Express and Pamt”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Heartland Express	$1.05 billion	0.70	-$29.72 million	($0.37)	-25.38
Pamt	$714.65 million	0.37	-$31.80 million	($1.46)	-8.38

Heartland Express has higher revenue and earnings than Pamt. Heartland Express is trading at a lower price-to-earnings ratio than Pamt, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Heartland Express and Pamt’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Heartland Express	-2.84%	-3.57%	-2.14%
Pamt	-4.45%	-2.58%	-1.07%

Summary

Heartland Express beats Pamt on 7 of the 13 factors compared between the two stocks.

About Heartland Express

Heartland Express, Inc., together with its subsidiaries, operates as a short-to-medium, and long-haul truckload carrier in the United States and Canada. It primarily provides nationwide asset-based dry van truckload service for shippers; cross-border freight and other transportation services; and temperature-controlled truckload services. The company offers its services under the Heartland Express and Millis Transfer brand names. It primarily serves retailers and manufacturers in consumer goods, appliances, food products, and automotive industries. The company was founded in 1978 and is headquartered in North Liberty, Iowa.

About Pamt

PAMT Corp. is a holding company, which engages in the provision of truckload and logistics services through its subsidiaries. Its freight consists primarily of automotive parts, expedited goods, consumer goods, such as general retail store merchandise, and manufactured goods, such as heating and air conditioning units. The company was founded in June 1986 and is headquartered in Tontitown, AR.