Seaspan (NYSE: SSW) and Danaos (NYSE:DAC) are both small-cap industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, valuation and profitability.
Valuation & Earnings
This table compares Seaspan and Danaos’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Seaspan||$877.91 million||0.96||-$139.03 million||$0.46||14.83|
|Danaos||$498.33 million||0.32||-$366.19 million||($3.79)||-0.38|
Insider & Institutional Ownership
14.3% of Seaspan shares are owned by institutional investors. Comparatively, 2.0% of Danaos shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
This is a summary of recent ratings and recommmendations for Seaspan and Danaos, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Seaspan currently has a consensus price target of $8.21, indicating a potential upside of 20.44%. Danaos has a consensus price target of $3.00, indicating a potential upside of 106.90%. Given Danaos’ stronger consensus rating and higher possible upside, analysts plainly believe Danaos is more favorable than Seaspan.
Seaspan pays an annual dividend of $0.50 per share and has a dividend yield of 7.3%. Danaos does not pay a dividend. Seaspan pays out 108.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Danaos has raised its dividend for 6 consecutive years.
Volatility and Risk
Seaspan has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, Danaos has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500.
This table compares Seaspan and Danaos’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Seaspan beats Danaos on 9 of the 16 factors compared between the two stocks.
Seaspan Company Profile
Seaspan Corporation is an independent charter owner and manager of containerships. The Company charters pursuant to long-term, fixed-rate time charters with various container liner companies. As of February 20, 2017, it had operated a fleet of 88 containerships and had entered into contracts for the purchase of an additional eight new building containerships. Its operating vessels include YM Wish, YM Wellhead, YM Witness, COSCO Glory, COSCO Development, COSCO Harmony, COSCO Excellence, COSCO Hope, COSCO Fortune, Seaspan Yangtze, CSCL Zeebrugge, CSCL Long Beach, CSCL Oceania, COSCO Vietnam, MOL Emissary, Seaspan Chiwan, Seaspan Ningbo, Seaspan Felixstowe, CSCL Brisbane, Seaspan Santos, Seaspan Loncomilla, Seaspan Lingue, CSCL Montevideo, CSCL Callao, Guayaquil Bridge and Calicanto Bridge. The Company is engaged in the operation and management of vessel, including maintaining the vessel, periodic dry-docking, cleaning and painting and performing work required by regulations.
Danaos Company Profile
Danaos Corporation is a holding company and an international owner of containerships, chartering its vessels to a range of liner companies. The Company’s principal business is the acquisition and operation of vessels. The Company conducts its operations through the vessel owning companies, whose principal activity is the ownership and operation of containerships that are under the management of a related party of the company. The Company’s manager is Danaos Shipping Company Limited (Danaos Shipping). The Company has a fleet of over 50 containerships aggregating approximately 329,590 twenty-foot equivalent units (TEUs). Its containership fleet includes approximately 53 containerships deployed on time charters and approximately two containerships deployed on bareboat charter. Gemini Shipholdings Corporation (Gemini), a company beneficially owned by the Company, owns approximately four additional containerships of over 24,000 TEU aggregate capacity.
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