Kansas City Southern (NYSE:KSU) and Aurizon (OTCMKTS:QRNNF) are both transportation companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, earnings, profitability, valuation and dividends.

Dividends

Kansas City Southern pays an annual dividend of $1.44 per share and has a dividend yield of 1.3%. Aurizon does not pay a dividend. Kansas City Southern pays out 24.1% of its earnings in the form of a dividend. Kansas City Southern has increased its dividend for 5 consecutive years.

Profitability

This table compares Kansas City Southern and Aurizon’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kansas City Southern 23.12% 12.11% 6.54%
Aurizon N/A N/A N/A

Earnings and Valuation

This table compares Kansas City Southern and Aurizon’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kansas City Southern $2.71 billion 4.27 $627.40 million $5.97 19.25
Aurizon N/A N/A N/A N/A N/A

Kansas City Southern has higher revenue and earnings than Aurizon.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Kansas City Southern and Aurizon, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kansas City Southern 0 2 10 1 2.92
Aurizon 0 1 0 0 2.00

Kansas City Southern presently has a consensus price target of $123.92, suggesting a potential upside of 7.81%. Given Kansas City Southern’s stronger consensus rating and higher probable upside, equities analysts clearly believe Kansas City Southern is more favorable than Aurizon.

Insider & Institutional Ownership

87.7% of Kansas City Southern shares are owned by institutional investors. 0.7% of Kansas City Southern shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Kansas City Southern beats Aurizon on 12 of the 13 factors compared between the two stocks.

About Kansas City Southern

Kansas City Southern, a transportation holding company, provides domestic and international rail transportation services in North America. The company serves a ten-state region in the midwest and southeast regions of the United States and has the shortest north/south rail route between Kansas City, Missouri, and ports along the Gulf of Mexico in Alabama, Louisiana, Mississippi, and Texas. It operates a commercial corridor of the Mexican railroad system and has its direct rail passageway between Mexico City and Laredo, Texas. The company provides rail access to the United States and Mexico border crossing at Nuevo Laredo, Tamaulipas; and controls and operates the southern half of the rail bridge at Laredo, Texas, as well as the northern half of this bridge. Kansas City Southern also provides rail access to the port of Lazaro Cardenas on the Pacific Ocean; and owns a 157-mile rail line extending from Laredo, Texas to the port city of Corpus Christi, Texas. Its rail network comprises approximately 6,700 route miles. The company serves the chemical and petroleum, industrial and consumer products, agriculture and minerals, energy, intermodal, and automotive markets. Kansas City Southern was founded in 1887 and is headquartered in Kansas City, Missouri.

About Aurizon

Aurizon Holdings Limited, through its subsidiaries, operates an integrated heavy haul freight railway operator in Australia. It operates through Network, Coal, Bulk, and Other segments. The company transports various commodities, including mining, agricultural, industrial, and retail products; and retail goods and groceries across small and big towns, and cities, as well as coal and iron ore. It also operates and manages the Central Queensland Coal Network that consists of 2,670 kilometers of track network; and provides various specialist services, such as rail design, engineering, construction, management, and maintenance, as well as supply chain solutions. In addition, the company transports bulk freight for miners, primary producers, and the manufacturing industry. Further, it is involved in the general and containerized freight businesses, as well as provision of rail-based intermodal services. The company was formerly known as QR National Limited and changed its name to Aurizon Holdings Limited in December 2012. Aurizon Holdings Limited is headquartered in Fortitude Valley, Australia.

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