Teekay Corporation (TK) and International Seaways (NYSE:INSW) Critical Contrast

International Seaways (NYSE: INSW) and Teekay Corporation (NYSE:TK) are both small-cap transportation companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, analyst recommendations, profitability, dividends and risk.

Dividends

Teekay Corporation pays an annual dividend of $0.22 per share and has a dividend yield of 2.3%. International Seaways does not pay a dividend. Teekay Corporation pays out -15.4% of its earnings in the form of a dividend. Teekay Corporation has increased its dividend for 2 consecutive years.

Earnings and Valuation

This table compares International Seaways and Teekay Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
International Seaways $327.29 million 1.87 $85.71 million N/A N/A
Teekay Corporation $2.16 billion 0.38 $843.75 million ($1.43) -6.66

Teekay Corporation has higher revenue and earnings than International Seaways.

Insider and Institutional Ownership

85.7% of International Seaways shares are owned by institutional investors. Comparatively, 46.5% of Teekay Corporation shares are owned by institutional investors. 0.5% of International Seaways shares are owned by company insiders. Comparatively, 2.4% of Teekay Corporation shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations and price targets for International Seaways and Teekay Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
International Seaways 0 0 1 0 3.00
Teekay Corporation 1 3 0 0 1.75

International Seaways currently has a consensus target price of $30.00, suggesting a potential upside of 42.93%. Teekay Corporation has a consensus target price of $5.33, suggesting a potential downside of 44.04%. Given International Seaways’ stronger consensus rating and higher possible upside, equities analysts clearly believe International Seaways is more favorable than Teekay Corporation.

Profitability

This table compares International Seaways and Teekay Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
International Seaways -31.22% -4.56% -3.24%
Teekay Corporation -5.66% -2.80% -0.87%

Summary

Teekay Corporation beats International Seaways on 9 of the 14 factors compared between the two stocks.

About International Seaways

International Seaways, Inc. and its subsidiaries own and operate a fleet of oceangoing vessels. The Company’s oceangoing vessels engage in the transportation of crude oil and petroleum products in the International Flag trades. The Company’s segments are International Crude Tankers and International Product Carriers. Its 55-vessel fleet consists of Ultra Large Crude Carrier (ULCC), Very Large Crude Carrier (VLCC), Aframax and Panamax crude tankers, as well as long range 1 (LR1), LR2 and medium range (MR) product carriers. Its International Crude Tankers segment is made up of a ULCC and a fleet of VLCCs, Aframaxes, and Panamaxes. Its International Product Carriers segment consists of a fleet of MRs, LR1s and an LR2 engaged in the transportation of crude and refined petroleum products. Through joint venture partnerships (the JVs), it has ownership interests in approximately four liquefied natural gas carriers and approximately two floating storage and offloading service vessels.

About Teekay Corporation

Teekay Corporation (Teekay) is a provider of crude oil and gas marine transportation services. The Company also offers offshore oil production, storage and offloading services, primarily under long-term, fixed-rate contracts. The Company is engaged in the liquefied natural gas (LNG) and liquefied petroleum gas (LPG) shipping sectors, as well as in the operations in the offshore production, storage and transportation sector. It is also involved in the conventional tanker business. Teekay provides a set of marine services to the oil and gas companies. The Company has four lines of business: offshore logistics (shuttle tankers, the HiLoad DP unit, floating storage and off-take (FSO) units, units for maintenance and safety (UMS), and long-distance towing and offshore installation vessels), offshore production (floating production, storage and offloading (FPSO) units), liquefied gas carriers and conventional tankers.

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