Gener8 Maritime (NYSE: GNRT) and KNOT Offshore Partners (NYSE:KNOP) are both small-cap transportation companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.
This table compares Gener8 Maritime and KNOT Offshore Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|KNOT Offshore Partners||34.02%||11.18%||4.40%|
KNOT Offshore Partners pays an annual dividend of $2.08 per share and has a dividend yield of 9.6%. Gener8 Maritime does not pay a dividend. KNOT Offshore Partners pays out 87.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. KNOT Offshore Partners has increased its dividend for 4 consecutive years.
This is a breakdown of current recommendations and price targets for Gener8 Maritime and KNOT Offshore Partners, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|KNOT Offshore Partners||0||0||0||0||N/A|
Gener8 Maritime currently has a consensus target price of $10.00, indicating a potential upside of 49.70%. Given Gener8 Maritime’s higher probable upside, analysts clearly believe Gener8 Maritime is more favorable than KNOT Offshore Partners.
Insider & Institutional Ownership
76.0% of Gener8 Maritime shares are owned by institutional investors. Comparatively, 43.8% of KNOT Offshore Partners shares are owned by institutional investors. 13.7% of Gener8 Maritime shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Gener8 Maritime and KNOT Offshore Partners’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Gener8 Maritime||$404.62 million||1.37||$67.30 million||($1.41)||-4.74|
|KNOT Offshore Partners||$173.67 million||4.09||$59.84 million||$2.38||9.14|
Gener8 Maritime has higher revenue and earnings than KNOT Offshore Partners. Gener8 Maritime is trading at a lower price-to-earnings ratio than KNOT Offshore Partners, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Gener8 Maritime has a beta of 1.4, suggesting that its stock price is 40% more volatile than the S&P 500. Comparatively, KNOT Offshore Partners has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500.
About Gener8 Maritime
Gener8 Maritime, Inc. is a provider of international seaborne crude oil transportation services. The Company operates through the transportation of international seaborne crude oil and petroleum products with its fleet of vessels segment. As of March 10, 2017, the Company owned a fleet of 40 tankers on the water, consisting of 24 Very Large Crude Carriers (VLCCs), 10 Suezmax vessels, four Aframax vessels and two Panamax vessels, with an aggregate carrying capacity of 9.4 million deadweight tons (DWT) and one eco VLCC newbuilding. As of March 10, 2017, approximately 77% of its total fleet carrying capacity based on DWT, including newbuildings, was focused on VLCC vessels. As of March 10, 2017, all of its VLCC vessels were deployed in Navig8 Group’s VL8 Pool, all of its Suezmax vessels were deployed in Navig8 Group’s Suez8 Pool and all of its Aframax vessels were deployed in the Navig8 Group’s V8 Pool.
About KNOT Offshore Partners
KNOT Offshore Partners LP (KNOT Offshore Partners or the Partnership), owns, operates and acquires shuttle tankers under long-term charters. The Partnership’s vessels in its fleet are chartered to Statoil ASA (Statoil), Petrobras Transporte S.A. (Transpetro), Repsol Sinopec Brasil, S.A. (Repsol), Royal Dutch Shell plc, ExxonMobil, and Eni Trading and Shipping S.p.A. (ENI). As of March 17, 2017, the Company had a fleet of 12 shuttle tankers. Its shuttle tankers include Fortaleza Knutsen, Recife Knutsen, Bodil Knutsen and Dan Cisne. KNOT Offshore Partners GP LLC is the general partner of the Partnership. It is engaged in the loading, transportation and storage of the crude oil using the vessels in its fleet. It provides all of these services under time charters and bareboat charters. As of December 31, 2016, eight of its shuttle tankers were chartered under time charters and four of its shuttle tankers were chartered under bareboat charters.
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