Tsakos Energy Navigation (NYSE: TNP) and KNOT Offshore Partners (NYSE:KNOP) are both small-cap transportation companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, dividends, valuation, risk, earnings and institutional ownership.

Volatility & Risk

Tsakos Energy Navigation has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500. Comparatively, KNOT Offshore Partners has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.

Earnings & Valuation

This table compares Tsakos Energy Navigation and KNOT Offshore Partners’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tsakos Energy Navigation $481.79 million 0.60 $55.78 million $0.11 30.73
KNOT Offshore Partners $173.67 million 3.92 $59.84 million $2.39 8.72

KNOT Offshore Partners has lower revenue, but higher earnings than Tsakos Energy Navigation. KNOT Offshore Partners is trading at a lower price-to-earnings ratio than Tsakos Energy Navigation, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

26.0% of Tsakos Energy Navigation shares are owned by institutional investors. Comparatively, 44.0% of KNOT Offshore Partners shares are owned by institutional investors. 1.0% of Tsakos Energy Navigation shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Tsakos Energy Navigation and KNOT Offshore Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tsakos Energy Navigation 5.64% 2.02% 0.88%
KNOT Offshore Partners 34.02% 11.18% 4.40%

Dividends

Tsakos Energy Navigation pays an annual dividend of $0.20 per share and has a dividend yield of 5.9%. KNOT Offshore Partners pays an annual dividend of $2.08 per share and has a dividend yield of 10.0%. Tsakos Energy Navigation pays out 181.8% 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 pays out 87.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. KNOT Offshore Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Tsakos Energy Navigation and KNOT Offshore Partners, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tsakos Energy Navigation 0 2 5 0 2.71
KNOT Offshore Partners 0 0 0 0 N/A

Tsakos Energy Navigation currently has a consensus target price of $5.14, suggesting a potential upside of 52.16%. Given Tsakos Energy Navigation’s higher possible upside, analysts plainly believe Tsakos Energy Navigation is more favorable than KNOT Offshore Partners.

Summary

KNOT Offshore Partners beats Tsakos Energy Navigation on 9 of the 15 factors compared between the two stocks.

About Tsakos Energy Navigation

Tsakos Energy Navigation Ltd is a provider of international seaborne crude oil and petroleum product transportation services. The Company operates through maritime transportation of liquid energy related products segment. The Company consists of 65 double-hull vessels, constituting a mix of crude tankers, product tankers and liquefied natural gas (LNG) carriers, totaling 7.2 million deadweight. Of these, 47 vessels trade in crude, 13 in products, three are shuttle tankers and two are LNG carriers. Its diversified fleet, which includes VLCC, aframax, panamax, handysize, handymax tankers, LNG carrier and DP2 shuttle tankers, allows it to serve its customers’ international petroleum product and crude oil transportation needs.

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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