Analyzing Teekay Tankers (NYSE:TNK) and EuroDry (NYSE:EDRY)

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EuroDry (NASDAQ:EDRY) and Teekay Tankers (NYSE:TNK) are both small-cap transportation companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, dividends, risk, profitability and institutional ownership.

Analyst Ratings

This is a summary of recent recommendations for EuroDry and Teekay Tankers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
EuroDry 0 0 2 0 3.00
Teekay Tankers 1 2 1 0 2.00

EuroDry currently has a consensus price target of $12.25, suggesting a potential upside of 52.14%. Teekay Tankers has a consensus price target of $1.00, suggesting a potential downside of 24.81%. Given EuroDry’s stronger consensus rating and higher probable upside, equities research analysts plainly believe EuroDry is more favorable than Teekay Tankers.

Insider & Institutional Ownership

0.0% of EuroDry shares are owned by institutional investors. Comparatively, 23.7% of Teekay Tankers shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares EuroDry and Teekay Tankers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
EuroDry 12.94% 5.86% 2.08%
Teekay Tankers -2.56% -1.91% -0.84%

Valuation & Earnings

This table compares EuroDry and Teekay Tankers’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
EuroDry $24.52 million 0.75 $1.12 million $0.24 33.55
Teekay Tankers $755.76 million 0.47 -$52.55 million ($0.20) -6.65

EuroDry has higher earnings, but lower revenue than Teekay Tankers. Teekay Tankers is trading at a lower price-to-earnings ratio than EuroDry, indicating that it is currently the more affordable of the two stocks.

Summary

EuroDry beats Teekay Tankers on 10 of the 12 factors compared between the two stocks.

EuroDry Company Profile

EuroDry Ltd., through its subsidiaries, provides ocean-going transportation services worldwide. The company owns and operates drybulk carriers that transport major bulks, such as iron ore, coal, and grains; and minor bulks comprising bauxite, phosphate, and fertilizers. As of November 15, 2018, it operated a fleet of six vessels, including one Ultramax, two Kamsarmax, and three Panamax drybulk carriers with a cargo capacity of 453,086 deadweight tons. The company was founded in 2018 and is based in Maroussi, Greece.

Teekay Tankers Company Profile

Teekay Tankers Ltd. provides marine transportation services to oil industries in Bermuda and internationally. It operates through two segments, Conventional Tanker and Ship-to-ship Transfer (STS). The company offers voyage and time charter services; and offshore STS transfer services of commodities primarily crude oil and refined oil products, as well as liquid gases and various other products. It also provides vessels commercial and technical management, LNG terminal management, consultancy, procurement, and equipment rental services; and lightering support services, including full service lightering and other lightering support services. As of December 31, 2018, it operated a fleet of 56 owned and leased conventional tankers, 3 in-chartered vessels, and 1 jointly-owned very large crude carrier; and 6 STS support vessels. Its vessels operated under fixed-rate time charter contracts with its customers. The company was founded in 2007 and is based in Hamilton, Bermuda.

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