Hornbeck Offshore Services (NYSE: HOS) and Safe Bulkers (NYSE:SB) are both small-cap oils/energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitabiliy, analyst recommendations, earnings, risk, valuation and dividends.

Profitability

This table compares Hornbeck Offshore Services and Safe Bulkers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hornbeck Offshore Services -43.97% -5.96% -2.91%
Safe Bulkers -35.00% -4.35% -2.13%

Risk and Volatility

Hornbeck Offshore Services has a beta of 1.23, meaning that its stock price is 23% more volatile than the S&P 500. Comparatively, Safe Bulkers has a beta of 2.38, meaning that its stock price is 138% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Hornbeck Offshore Services and Safe Bulkers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hornbeck Offshore Services 1 3 0 0 1.75
Safe Bulkers 1 5 2 0 2.13

Hornbeck Offshore Services presently has a consensus target price of $6.00, suggesting a potential upside of 141.94%. Safe Bulkers has a consensus target price of $1.95, suggesting a potential downside of 25.86%. Given Hornbeck Offshore Services’ higher probable upside, analysts plainly believe Hornbeck Offshore Services is more favorable than Safe Bulkers.

Institutional & Insider Ownership

97.5% of Hornbeck Offshore Services shares are owned by institutional investors. Comparatively, 15.2% of Safe Bulkers shares are owned by institutional investors. 7.1% of Hornbeck Offshore Services shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Hornbeck Offshore Services and Safe Bulkers’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Hornbeck Offshore Services $191.56 million 0.48 $23.47 million ($2.31) -1.07
Safe Bulkers $118.40 million 2.21 $52.14 million ($0.65) -4.05

Safe Bulkers has higher revenue, but lower earnings than Hornbeck Offshore Services. Safe Bulkers is trading at a lower price-to-earnings ratio than Hornbeck Offshore Services, indicating that it is currently the more affordable of the two stocks.

Summary

Safe Bulkers beats Hornbeck Offshore Services on 9 of the 13 factors compared between the two stocks.

Hornbeck Offshore Services Company Profile

Hornbeck Offshore Services Inc. provides marine transportation, subsea installation and accommodation support services to exploration and production, oilfield service, offshore construction and the United States military customers. The Company focuses on providing marine solutions for the deepwater and ultradeepwater energy industry in domestic and select foreign locations. The Company, through its subsidiaries, operates offshore supply vessels (OSVs), multi-purpose support vessels (MPSVs), and a shore-base facility to provide logistics support and specialty services to the offshore oil and gas exploration and production industry, primarily in the United States, Gulf of Mexico, Latin America and selected international markets. Its OSVs and MPSVs support the deep-well, deepwater and ultra-deepwater activities of the offshore oil and gas industry. It provides vessel management services for other vessel owners, such as crewing, daily operational management and maintenance activities.

Safe Bulkers Company Profile

Safe Bulkers, Inc. is a holding company. The Company’s principal business is the acquisition, ownership and operation of drybulk vessels. The Company’s vessels operate across the world, carrying drybulk cargo for the consumers of marine drybulk transportation services. The Company is an international provider of marine drybulk transportation services, transporting bulk cargoes, particularly coal, grain and iron ore, along shipping routes across the world. As of February 17, 2017 the Company’s fleet included 38 vessels, of which 14 are Panamax class vessels, nine are Kamsarmax class vessels, 12 are Post-Panamax class vessels and three are Capesize class vessels, with an aggregate carrying capacity of 3,421,800 deadweight tonnage (dwt). The Company’s fleet of Post-Panamax vessels includes Marina, Xenia, Sophia, Eleni, Martine, Andreas K, Panayiota K, Venus Heritage, Venus History, Venus Horizon and Troodos Sun. Its fleet of Capesize vessels includes Kanaris, Pelopidas and Lake Despina.

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