Safe Bulkers (NYSE: SB) and Costamare (NYSE:CMRE) are both small-cap transportation companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, profitability, dividends, institutional ownership, risk and earnings.
Volatility & Risk
Safe Bulkers has a beta of 2.34, suggesting that its share price is 134% more volatile than the S&P 500. Comparatively, Costamare has a beta of 2.17, suggesting that its share price is 117% more volatile than the S&P 500.
This is a summary of current recommendations and price targets for Safe Bulkers and Costamare, as provided by MarketBeat.
||Strong Buy Ratings
Safe Bulkers presently has a consensus target price of $3.13, suggesting a potential downside of 9.42%. Costamare has a consensus target price of $7.10, suggesting a potential upside of 12.52%. Given Costamare’s higher probable upside, analysts clearly believe Costamare is more favorable than Safe Bulkers.
Costamare pays an annual dividend of $0.40 per share and has a dividend yield of 6.3%. Safe Bulkers does not pay a dividend. Costamare pays out 111.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Costamare has raised its dividend for 3 consecutive years.
Institutional and Insider Ownership
19.0% of Safe Bulkers shares are held by institutional investors. Comparatively, 26.4% of Costamare shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Earnings & Valuation
This table compares Safe Bulkers and Costamare’s gross revenue, earnings per share and valuation.
||Earnings Per Share
Costamare has higher revenue and earnings than Safe Bulkers. Safe Bulkers is trading at a lower price-to-earnings ratio than Costamare, indicating that it is currently the more affordable of the two stocks.
This table compares Safe Bulkers and Costamare’s net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
Costamare beats Safe Bulkers on 10 of the 15 factors compared between the two stocks.
About Safe Bulkers
Safe Bulkers, Inc. is a holding company. The Company’s principal business is the acquisition, ownership and operation of drybulk vessels. The Company’s vessels operate across the world, carrying drybulk cargo for the consumers of marine drybulk transportation services. The Company is an international provider of marine drybulk transportation services, transporting bulk cargoes, particularly coal, grain and iron ore, along shipping routes across the world. As of February 17, 2017 the Company’s fleet included 38 vessels, of which 14 are Panamax class vessels, nine are Kamsarmax class vessels, 12 are Post-Panamax class vessels and three are Capesize class vessels, with an aggregate carrying capacity of 3,421,800 deadweight tonnage (dwt). The Company’s fleet of Post-Panamax vessels includes Marina, Xenia, Sophia, Eleni, Martine, Andreas K, Panayiota K, Venus Heritage, Venus History, Venus Horizon and Troodos Sun. Its fleet of Capesize vessels includes Kanaris, Pelopidas and Lake Despina.
Costamare Inc. (Costamare) is a holding company. The Company is an international owner of containerships. The Company is engaged in chartering its vessels to various liner companies. The Company provides marine transportation services around the world by chartering its container vessels to liner operators under long, medium and short-term time charters. As of March 10, 2017, the Company had a fleet of 69 containerships with a total capacity of approximately 456,000 TEU, including five newbuilds on order. The Company’s fleet of vessels includes Cosco Guangzhou, Titan, Cosco Yantian, Valor, Valiant and Maersk Kobe. Its subsidiaries include Adele Shipping Co., Bastian Shipping Co., Cadence Shipping Co., Jodie Shipping Co. and Kayley Shipping Co.
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