Head-To-Head Review: Hoegh LNG Partners (HMLP) versus Tsakos Energy Navigation (TNP)

Hoegh LNG Partners (NYSE: HMLP) and Tsakos Energy Navigation (NYSE:TNP) are both small-cap energy companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, profitability, risk, analyst recommendations and dividends.

Dividends

Hoegh LNG Partners pays an annual dividend of $1.72 per share and has a dividend yield of 10.0%. Tsakos Energy Navigation pays an annual dividend of $0.20 per share and has a dividend yield of 6.2%. Hoegh LNG Partners pays out 89.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tsakos Energy Navigation pays out 181.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tsakos Energy Navigation has increased its dividend for 2 consecutive years. Hoegh LNG Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

64.3% of Hoegh LNG Partners shares are held by institutional investors. Comparatively, 25.8% of Tsakos Energy Navigation shares are held by institutional investors. 1.0% of Tsakos Energy Navigation shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Hoegh LNG Partners and Tsakos Energy Navigation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hoegh LNG Partners $91.11 million 3.74 $41.37 million $1.92 8.98
Tsakos Energy Navigation $481.79 million 0.57 $55.78 million $0.11 29.18

Tsakos Energy Navigation has higher revenue and earnings than Hoegh LNG Partners. Hoegh LNG Partners is trading at a lower price-to-earnings ratio than Tsakos Energy Navigation, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Hoegh LNG Partners has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, Tsakos Energy Navigation has a beta of 1.33, suggesting that its share price is 33% more volatile than the S&P 500.

Profitability

This table compares Hoegh LNG Partners and Tsakos Energy Navigation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hoegh LNG Partners 38.90% 7.77% 3.30%
Tsakos Energy Navigation 5.64% 2.02% 0.88%

Analyst Recommendations

This is a summary of current ratings for Hoegh LNG Partners and Tsakos Energy Navigation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hoegh LNG Partners 0 0 3 0 3.00
Tsakos Energy Navigation 0 2 5 0 2.71

Hoegh LNG Partners currently has a consensus target price of $21.50, suggesting a potential upside of 24.64%. Tsakos Energy Navigation has a consensus target price of $5.36, suggesting a potential upside of 66.89%. Given Tsakos Energy Navigation’s higher possible upside, analysts plainly believe Tsakos Energy Navigation is more favorable than Hoegh LNG Partners.

Summary

Hoegh LNG Partners beats Tsakos Energy Navigation on 9 of the 17 factors compared between the two stocks.

Hoegh LNG Partners Company Profile

Hoegh LNG Partners LP owns, operates and acquires floating storage and regasification units (FSRUs), liquefied natural gas (LNG) carriers and other LNG infrastructure assets under long-term charters. The Company’s segments include Majority held FSRUs, Joint venture FSRUs and other. The Majority held FSRUs segment includes the direct financing lease related to the PT Perusahaan Gas Negara (Persero) Tbk (PGN) FSRU Lampung and the operating lease related to the Hoegh Gallant. The Joint venture FSRUs segment includes approximately two FSRUs, including the GDF Suez LNG Supply S.A. (GDF Suez) Neptune and the GDF Suez Cape Ann, which operate under long term time charters. The Company intends to acquire newbuilding FSRUs on long-term charters, rather than FSRUs based on retrofitted, first-generation LNG carriers. The PGN FSRU Lampung is located offshore in the Lampung province at the southeast coast of Sumatra, Indonesia.

Tsakos Energy Navigation Company Profile

Tsakos Energy Navigation Ltd is a provider of international seaborne crude oil and petroleum product transportation services. The Company operates through maritime transportation of liquid energy related products segment. The Company consists of 65 double-hull vessels, constituting a mix of crude tankers, product tankers and liquefied natural gas (LNG) carriers, totaling 7.2 million deadweight. Of these, 47 vessels trade in crude, 13 in products, three are shuttle tankers and two are LNG carriers. Its diversified fleet, which includes VLCC, aframax, panamax, handysize, handymax tankers, LNG carrier and DP2 shuttle tankers, allows it to serve its customers’ international petroleum product and crude oil transportation needs.

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