Critical Survey: Werner Enterprises (NASDAQ:WERN) and Forward Air (NASDAQ:FWRD)

Werner Enterprises (NASDAQ:WERN) and Forward Air (NASDAQ:FWRD) are both small-cap transportation companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Insider and Institutional Ownership

89.3% of Werner Enterprises shares are owned by institutional investors. Comparatively, 97.0% of Forward Air shares are owned by institutional investors. 1.3% of Werner Enterprises shares are owned by insiders. Comparatively, 17.2% of Forward Air shares are owned by 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 Werner Enterprises and Forward Air’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Werner Enterprises	1.77%	0.92%	0.44%
Forward Air	-6.86%	-40.36%	-3.77%

Volatility & Risk

Werner Enterprises has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, Forward Air has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Werner Enterprises and Forward Air, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Werner Enterprises	6	6	3	0	1.80
Forward Air	0	2	3	0	2.60

Werner Enterprises currently has a consensus target price of $30.50, suggesting a potential upside of 5.83%. Forward Air has a consensus target price of $37.75, suggesting a potential upside of 24.26%. Given Forward Air’s stronger consensus rating and higher probable upside, analysts plainly believe Forward Air is more favorable than Werner Enterprises.

Valuation and Earnings

This table compares Werner Enterprises and Forward Air”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Werner Enterprises	$3.03 billion	0.57	$34.23 million	$0.86	33.51
Forward Air	$2.47 billion	0.38	-$816.97 million	($5.99)	-5.07

Werner Enterprises has higher revenue and earnings than Forward Air. Forward Air is trading at a lower price-to-earnings ratio than Werner Enterprises, indicating that it is currently the more affordable of the two stocks.

Summary

Werner Enterprises beats Forward Air on 8 of the 13 factors compared between the two stocks.

About Werner Enterprises

Werner Enterprises, Inc., together with its subsidiaries, engages in transporting truckload shipments of general commodities in interstate and intrastate commerce in the United States, Mexico, and internationally. The company operates through two segments, Truckload Transportation Services and Werner Logistics. The Truckload Transportation Services segment operates a fleet of medium-to-long-haul vans that transports various consumer nondurable products and other commodities in truckload quantities using dry van trailers; the expedited fleet, which offers time-sensitive truckload services using driver teams; a regional short-haul fleet that provides truckload van service in the United States; and temperature-controlled fleet, which offers truckload services for temperature-sensitive products using temperature-controlled trailers. This segment provides truckload services to retail distribution centers or manufacturing facilities using dry vans or trailers to transport retail store merchandise, consumer products, food and beverage products, and manufactured products. As of December 31, 2023, it had a fleet of 8,000 trucks, which included 7,740 company-operated, as well as 260 owned and operated by independent contractors; and 30,810 trailers that comprised dry vans, flatbeds, temperature-controlled, and other trailers. The Werner Logistics segment provides non-asset-based transportation and logistics services, including truck brokerage; logistics management services and solutions; rail transportation through alliances with rail and drayage providers; and residential and commercial deliveries of large or heavy items using liftgate straight trucks. As of December 31, 2023, this segment operated 35 drayage tractors and 115 delivery trucks. It also sells used trucks and trailers; and trades used trucks to original equipment manufacturers. The company was founded in 1956 and is headquartered in Omaha, Nebraska.

About Forward Air

Forward Air Corporation, together with its subsidiaries, operates as an asset-light freight and logistics company in the United States and Canada. It operates in two segments, Expedited Freight and Intermodal. The Expedited Freight segment provides expedited regional, inter-regional, and national less-than-truckload services; local pick-up and delivery services; and other services, which include shipment consolidation and deconsolidation, warehousing, customs brokerage, and other handling. This segment offers expedited truckload brokerage, dedicated fleet, and high security and temperature-controlled logistics services. The Intermodal segment provides intermodal container drayage services; and contract and container freight station warehouse and handling services. It serves freight forwarders, third-party logistics companies, integrated air cargo carriers and passenger, passenger and cargo airlines, steamship lines, and retailers. Forward Air Corporation was founded in 1981 and is headquartered in Greeneville, Tennessee.