Scorpio Tankers (NYSE:STNG) and Diana Shipping (NYSE:DSX) are both small-cap transportation companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, earnings, risk and dividends.
Insider and Institutional Ownership
38.7% of Scorpio Tankers shares are owned by institutional investors. Comparatively, 24.7% of Diana Shipping shares are owned by institutional investors. 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.
Profitability
This table compares Scorpio Tankers and Diana Shipping's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Scorpio Tankers | 18.26% | 8.82% | 3.49% |
| Diana Shipping | -78.81% | -5.63% | -2.81% |
Analyst Recommendations
This is a summary of current ratings and target prices for Scorpio Tankers and Diana Shipping, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Scorpio Tankers | 1 | 2 | 6 | 0 | 2.56 |
| Diana Shipping | 0 | 2 | 3 | 0 | 2.60 |
Scorpio Tankers presently has a consensus target price of $22.00, suggesting a potential upside of 29.72%. Diana Shipping has a consensus target price of $4.00, suggesting a potential upside of 32.01%. Given Diana Shipping's stronger consensus rating and higher probable upside, analysts clearly believe Diana Shipping is more favorable than Scorpio Tankers.
Volatility and Risk
Scorpio Tankers has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, Diana Shipping has a beta of 1.41, suggesting that its share price is 41% more volatile than the S&P 500.
Valuation and Earnings
This table compares Scorpio Tankers and Diana Shipping's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Scorpio Tankers | $704.33 million | 1.39 | $-48,490,000.00 | ($0.94) | -17.95 |
| Diana Shipping | $220.73 million | 1.22 | $-10,530,000.00 | $0.06 | 50.33 |
Diana Shipping has lower revenue, but higher earnings than Scorpio Tankers. Scorpio Tankers is trading at a lower price-to-earnings ratio than Diana Shipping, indicating that it is currently the more affordable of the two stocks.
Summary
Scorpio Tankers beats Diana Shipping on 8 of the 13 factors compared between the two stocks.
