KNOT Offshore Partners (NYSE: KNOP) and Nordic American Tankers Limited (NYSE:NAT) are both small-cap transportation companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, risk, profitability and valuation.

Profitability

This table compares KNOT Offshore Partners and Nordic American Tankers Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KNOT Offshore Partners 35.75% 10.26% 4.31%
Nordic American Tankers Limited 0.06% 0.25% 0.16%

Volatility & Risk

KNOT Offshore Partners has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500. Comparatively, Nordic American Tankers Limited has a beta of 0.95, meaning that its stock price is 5% less volatile than the S&P 500.

Valuation & Earnings

This table compares KNOT Offshore Partners and Nordic American Tankers Limited’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
KNOT Offshore Partners $175.49 million 3.88 $133.46 million $2.39 9.60
Nordic American Tankers Limited $313.36 million 1.74 $89.71 million $0.02 268.00

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

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for KNOT Offshore Partners and Nordic American Tankers Limited, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KNOT Offshore Partners 0 2 0 0 2.00
Nordic American Tankers Limited 3 4 0 0 1.57

KNOT Offshore Partners currently has a consensus price target of $20.00, suggesting a potential downside of 12.85%. Nordic American Tankers Limited has a consensus price target of $6.92, suggesting a potential upside of 29.04%. Given Nordic American Tankers Limited’s higher possible upside, analysts plainly believe Nordic American Tankers Limited is more favorable than KNOT Offshore Partners.

Insider and Institutional Ownership

51.4% of KNOT Offshore Partners shares are held by institutional investors. Comparatively, 27.2% of Nordic American Tankers Limited shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

KNOT Offshore Partners pays an annual dividend of $2.08 per share and has a dividend yield of 9.1%. Nordic American Tankers Limited pays an annual dividend of $0.40 per share and has a dividend yield of 7.5%. 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. Nordic American Tankers Limited pays out 2,000.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Nordic American Tankers Limited has increased its dividend for 3 consecutive years. KNOT Offshore Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

KNOT Offshore Partners beats Nordic American Tankers Limited on 10 of the 15 factors compared between the two stocks.

KNOT Offshore Partners Company Profile

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.

Nordic American Tankers Limited Company Profile

Nordic American Tankers Limited is an international tanker company. The Company owns approximately 26 vessels, including approximately two new buildings under construction, of approximately 156,000 deadweight tonnage (dwt) each. The Company’s Suezmaxes tankers can carry over one million barrels of oil. The vessels in the Company’s fleet are homogenous and interchangeable. The Company’s vessels are employed in the spot market. The Company’s vessels include Nordic Harrier, Nordic Hawk, Nordic Hunter, Nordic Voyager, Nordic Fighter, Nordic Freedom, Nordic Discovery, Nordic Saturn, Nordic Jupiter, Nordic Moon, Nordic Apollo, Nordic Cosmos, Nordic Sprite, Nordic Mistral, Nordic Passat, Nordic Vega, Nordic Breeze, Nordic Zenith, Nordic Sprinter, Nordic Skier and Nordic Light.

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