Many investors do not know this, but more goods are moved by truck each year than by rail and air combined. It is for this reason that I think all long-term investors should own a trucking stock, so with this in mind, let’s take a look at three inexpensive ones that you could buy right now.
1. TransForce Inc.
TransForce Inc. (TSX:TFI) has the largest trucking fleet in Canada, with 15,470 power units and 18,480 trailers as of March 31, 2015. At today’s levels, its stock trades at 13.4 times fiscal 2015’s estimated earnings per share of $1.92 and 11.5 times fiscal 2016’s estimated earnings per share of $2.24, both of which are inexpensive compared with the industry average price-to-earnings multiple of 21.8. In addition, the company pays a quarterly dividend of $0.17 per share, or $0.68 per share annually, giving its stock a 2.6% yield.
2. Mullen Group Ltd.
Mullen Group Ltd. (TSX: MTL) owns a network of companies that provide specialized transportation services to the oil and natural gas industries in western Canada, and trucking and logistics services across Canada. At current levels, its stock trades at 33.6 times fiscal 2015’s estimated earnings per share of $0.61 and 18.5 times fiscal 2016’s estimated earnings per share of $1.11, the latter of which is inexpensive compared with the industry average price-to-earnings multiple of 21.8. Additionally, the company pays a monthly dividend of $0.10 per share, or $1.20 per share annually, which gives its stock a 5.85% yield.
3. Trimac Transportation Ltd.
Trimac Transportation Ltd. (TSX:TMA) provides truck transportation and related distribution and management services throughout North America. At today’s levels, its stock trades at 11.9 times fiscal 2015’s estimated earnings per share of $0.51 and 9.5 times fiscal 2016’s estimated earnings per share of $0.64, both of which are inexpensive compared with the industry average price-to-earnings multiple of 21.8. Also, the company pays a quarterly dividend of $0.07 per share, or $0.28 per share annually, giving its stock a 4.6% yield.
Which of these trucking stocks should you buy today?
TransForce, Mullen, and Trimac represent three of the best long-term investment opportunities in the trucking industry today. Foolish investors should strongly consider buying one of them right now.
