Ship Finance International Limited (NYSE: SFL) and Delek Logistics Partners, L.P. (NYSE:DKL) are both small-cap transportation companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, risk, earnings, dividends, institutional ownership, valuation and profitability.

Volatility & Risk

Ship Finance International Limited has a beta of 1.36, meaning that its share price is 36% more volatile than the S&P 500. Comparatively, Delek Logistics Partners, L.P. has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Ship Finance International Limited and Delek Logistics Partners, L.P., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ship Finance International Limited 0 1 0 0 2.00
Delek Logistics Partners, L.P. 0 2 1 0 2.33

Ship Finance International Limited presently has a consensus target price of $15.00, suggesting a potential upside of 13.21%. Delek Logistics Partners, L.P. has a consensus target price of $33.50, suggesting a potential upside of 15.72%. Given Delek Logistics Partners, L.P.’s stronger consensus rating and higher possible upside, analysts clearly believe Delek Logistics Partners, L.P. is more favorable than Ship Finance International Limited.

Valuation and Earnings

This table compares Ship Finance International Limited and Delek Logistics Partners, L.P.’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ship Finance International Limited $391.64 million 3.16 $249.26 million $1.23 10.77
Delek Logistics Partners, L.P. $488.39 million 1.44 $100.26 million $1.90 15.24

Ship Finance International Limited has higher revenue, but lower earnings than Delek Logistics Partners, L.P.. Ship Finance International Limited is trading at a lower price-to-earnings ratio than Delek Logistics Partners, L.P., indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ship Finance International Limited and Delek Logistics Partners, L.P.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ship Finance International Limited 29.59% 11.26% 4.24%
Delek Logistics Partners, L.P. 12.70% -368.38% 15.15%

Dividends

Ship Finance International Limited pays an annual dividend of $1.80 per share and has a dividend yield of 13.6%. Delek Logistics Partners, L.P. pays an annual dividend of $2.82 per share and has a dividend yield of 9.7%. Ship Finance International Limited pays out 146.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Delek Logistics Partners, L.P. pays out 148.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ship Finance International Limited has raised its dividend for 3 consecutive years and Delek Logistics Partners, L.P. has raised its dividend for 5 consecutive years. Ship Finance International Limited is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

24.3% of Ship Finance International Limited shares are owned by institutional investors. Comparatively, 28.8% of Delek Logistics Partners, L.P. shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Delek Logistics Partners, L.P. beats Ship Finance International Limited on 9 of the 16 factors compared between the two stocks.

Ship Finance International Limited Company Profile

Ship Finance International Limited is a holding, and international ship owning and chartering company. The Company is engaged in the ownership and operation of vessels and offshore related assets, and also involved in the charter, purchase and sale of assets. Its assets consist of approximately 20 oil tankers, over 20 dry bulk carriers, approximately 20 container vessels, including a newbuilding, two car carriers, two jack-up drilling rigs, two ultra-deepwater drilling units, five offshore supply vessels, two chemical tankers and two newbuilding oil product tankers. Its oil tankers, chemical tankers and oil product tankers are all double-hull vessels. It has over nine asset types, including crude oil tankers, oil product tankers, chemical tankers, container vessels, car carriers, dry bulk carriers, jack-up drilling rigs, ultra-deepwater drilling units and offshore supply vessels. Its assets consist of a fleet of Suezmax tankers, crude carriers and oil/bulk/ore carriers.

Delek Logistics Partners, L.P. Company Profile

Delek Logistics Partners, LP owns and operates logistics and marketing assets for crude oil, and intermediate and refined products. The Company’s business primarily consists of certain crude oil, intermediate and refined products pipelines and transportation, storage, wholesale marketing, terminaling and offloading assets, which were previously owned, operated or held by Delek US Holdings, Inc. (Delek), and assets acquired from unrelated third parties. The Company operates through two segments: Pipelines and Transportation segment, and Wholesale Marketing and Terminalling segment. The Company engaged in the gathering, transporting and storing crude oil; storing intermediate products and feed stocks, and marketing, distributing, transporting, offloading and storing refined products. The Company also provides crude oil, intermediate and refined products transportation services for terminaling, and marketing services to third parties primarily in Texas, Tennessee and Arkansas.

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