Nordic American Tankers Limited (NYSE: NAT) and Scorpio Tankers (NASDAQ:STNG) are both small-cap transportation companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitabiliy, valuation and dividends.
Earnings and Valuation
This table compares Nordic American Tankers Limited and Scorpio Tankers’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Nordic American Tankers Limited||$335.91 million||1.82||$113.60 million||$0.02||300.00|
|Scorpio Tankers||$480.42 million||1.28||$144.97 million||N/A||N/A|
Scorpio Tankers has higher revenue and earnings than Nordic American Tankers Limited.
This table compares Nordic American Tankers Limited and Scorpio Tankers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Nordic American Tankers Limited||0.06%||0.25%||0.16%|
This is a breakdown of current ratings and target prices for Nordic American Tankers Limited and Scorpio Tankers, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Nordic American Tankers Limited||3||4||0||0||1.57|
Nordic American Tankers Limited currently has a consensus target price of $7.50, indicating a potential upside of 25.00%. Scorpio Tankers has a consensus target price of $6.50, indicating a potential upside of 72.41%. Given Scorpio Tankers’ stronger consensus rating and higher probable upside, analysts clearly believe Scorpio Tankers is more favorable than Nordic American Tankers Limited.
Nordic American Tankers Limited pays an annual dividend of $0.80 per share and has a dividend yield of 13.3%. Scorpio Tankers does not pay a dividend. Nordic American Tankers Limited pays out 4,000.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Institutional and Insider Ownership
26.8% of Nordic American Tankers Limited shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
About Nordic American Tankers Limited
Nordic American Tankers Limited is an international tanker company. The Company owns approximately 26 vessels, including approximately two new buildings under construction, of approximately 156,000 deadweight tonnage (dwt) each. The Company’s Suezmaxes tankers can carry over one million barrels of oil. The vessels in the Company’s fleet are homogenous and interchangeable. The Company’s vessels are employed in the spot market. The Company’s vessels include Nordic Harrier, Nordic Hawk, Nordic Hunter, Nordic Voyager, Nordic Fighter, Nordic Freedom, Nordic Discovery, Nordic Saturn, Nordic Jupiter, Nordic Moon, Nordic Apollo, Nordic Cosmos, Nordic Sprite, Nordic Mistral, Nordic Passat, Nordic Vega, Nordic Breeze, Nordic Zenith, Nordic Sprinter, Nordic Skier and Nordic Light.
About Scorpio Tankers
Scorpio Tankers Inc. (Scorpio Tankers) is engaged in the seaborne transportation of refined petroleum products in the international shipping markets. The Company operates through four segments: Handymax, MR, LR1/Panamax and LR2. As of March 15, 2017, the Company’s fleet consisted of 78 owned tankers (22 LR2, 14 Handymax and 42 MR) with a weighted average age of approximately 2.3 years, and 19 time or bareboat chartered-in tankers, which it operated (one LR2, one LR1, eight MR and nine Handymax) (collectively referred to as its Operating Fleet). As of March 1, 2017, the Company’s total oil tanker fleet (crude, products and product/chemical tankers) consisted of 4,754 ships with a combined capacity of 525.9 million deadweight tonnage. As of December 31, 2016, the Company also had contracts for the construction of one LR2 tanker and eight MR tankers. Its vessels include STI Brixton, STI Comandante, STI Finchley, STI Hammersmith, STI Larvotto, STI San Antonio and STI Regina.
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