Earnings season continued November 1 with Arkansas Best (Nasdaq:ABFS) announcing its third quarter results before the market opened Thursday, and Starbucks (Nasdaq:SBUX) delivered its fourth quarter and year-end numbers after the market closed. Analyzing the reports of two completely different businesses, and then comparing them to decide which stock is the better investment, isn't an easy task. Nonetheless, here is a rundown of the pros and cons of each company's results.

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Arkansas Best - Pros
Operating revenues grew 13% to $577.5 million, beating the consensus estimate by $12.24 million. Its non-asset-based segments include: truck brokerage, roadside assistance for commercial vehicles, logistics and expedited freight services, and household moving services. Thanks to the June purchase of Panther Expedited Services from private equity firm Fenway Partners for $180 million, the four segments were able to generate $130.3 million in revenue in Q for a 119% increase year-over-year.

More importantly, the asset-light part of its business accounted for 23% of its overall revenue and 31% of operating income. In terms of operating income growth, its non-asset-based businesses saw a 15.3% increase from the same quarter last year. While there wasn't a whole lot of good news to report in its freight transportation division (79% of revenue), it did manage to increase the billed revenue per shipment by 3.7% to $393.47.

Arkansas Best - Cons
It's important to keep in mind that while the third quarter wasn't pretty, it still managed to deliver a profit, which is all that really matters. They can't all be home runs. ABF Freight Systems saw its business levels decline by 1.4% in the third quarter to 12,463 tons per day. However, due to price increases throughout most of 2011 and into the first quarter of 2012, which resulted in higher billed revenue per shipment, Arkansas Best's biggest segment saw revenues decline by just $3.3 million. Unfortunately, due to its ongoing high cost operating structure, ABF Freight Systems' operating expenses increased over 200 basis points (bps) to 97.9% of revenue. Negotiations on a new labor contract with the Teamsters begin December 18.

Management is hopeful it can negotiate a contract that allows it to move forward, profitably creating new jobs along the way. How likely is the union to budge? If recent deals in Canada with Ford (NYSE:F) and General Motors (NYSE:GM) are any indication, I believe Arkansas Best should be able to hammer out an equitable compromise with its employees. Until then, investors can expect its reduced profitability to continue. In the third quarter, its overall operating profits declined 42% to $12.2 million and ABF Freight Systems by 52% to $8.4 million. Therefore, it's no wonder that its stock is trading at its lowest level since 2000.

SEE: How To Decode A Company's Earnings Report

Starbucks - Pros
There's a lot that's good about its fourth quarter and year-end results. Starting with the first quarter, I really liked the 60 bps improvement in its non-GAAP operating margin to 15.4%. Its margins have never been higher. Because of its margin expansion, its non-GAAP earnings per share increased 24% to 46 cents. Not wanting to forget same-store sales, globally they increased 6% in the fourth quarter, including a 15% jump in the China Asia Pacific (CAP) segment.

Speaking of margins, the CAP region, despite a 340-basis point reduction in its operating margin, managed to generate an operating margin of 32.9% in the quarter. If it can hold the line on those margins, continue to open new stores and grow same store sales on a quarterly basis, there's no telling how profitable the overall company can be.

Its year-end results were slightly higher in terms of revenue growth - up 13.7% to a record $13.3 billion. Global same-store sales were also higher for the entire fiscal year, increasing by 7%, with a 15% boost from the CAP region, and earnings per share on a non-GAAP basis increased 180% to $1.79. What this tells me is that while revenues increased at a faster rate in the first three quarters of the year compared to the fourth, its bottom line fattened in the fourth quarter, making 2013 something to look forward to.

Starbucks - Cons
About the only negative I can see with Starbucks is its Europe, Middle East and Africa (EMEA) segment, which had an operating loss of $6.5 million in the fourth quarter, on $283.7 million in revenue. However, as EMEA President Michelle Gass pointed out in her presentation for yesterday's conference call, that were it not for $11.5 million in charges to optimize its store portfolio for greater profitability and $9.2 million for asset impairments in U.K., Germany and France, its operating margin in Q4 2012 actually improved to 1.8% from 0.9% in Q4 2011.

Gass was brought in a year ago to turn around the profitability in the region. As a 16-year veteran of the company, I'm sure she'll do what needs getting done in order to reach its operating margin goal in the mid-teens. The European economy will have to improve quite a bit, but that's not something she can control. All Gass and her team can do is work on improving the customer experience and controlling its costs. The rest is out of its hands.

The Bottom Line
As long as its management continues to stay solid, and its employers remember to treat its employees right and deliver a positive customer experience, I don't see Starbucks losing its mojo anytime soon. Arkansas Best, on the other hand, is a beaten-down stock in a very competitive industry. It hasn't traded this low since 1999 and its profitability hasn't looked good for some time now. As a value play, I'd probably give it serious consideration. That said, Starbucks is a better investment over Arkansas Best right now, and probably many years into the future as well.

At the time of writing, Will Ashworth did not own any shares in any company mentioned in this article.

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