Western Refining Logistics (NYSE: WNRL) and Frontline (NYSE:FRO) are both small-cap energy companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, earnings, analyst recommendations, dividends and profitability.
Valuation and Earnings
This table compares Western Refining Logistics and Frontline’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Western Refining Logistics||N/A||N/A||N/A||$1.07||22.29|
|Frontline||$646.33 million||1.15||-$264.86 million||($1.56)||-2.81|
This is a breakdown of recent ratings and target prices for Western Refining Logistics and Frontline, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Western Refining Logistics||0||0||0||0||N/A|
Frontline has a consensus target price of $5.67, suggesting a potential upside of 29.08%. Given Frontline’s higher probable upside, analysts plainly believe Frontline is more favorable than Western Refining Logistics.
Western Refining Logistics pays an annual dividend of $1.87 per share and has a dividend yield of 7.8%. Frontline pays an annual dividend of $0.30 per share and has a dividend yield of 6.8%. Western Refining Logistics pays out 174.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Frontline pays out -19.2% of its earnings in the form of a dividend. Western Refining Logistics has raised its dividend for 2 consecutive years and Frontline has raised its dividend for 3 consecutive years.
This table compares Western Refining Logistics and Frontline’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Western Refining Logistics||2.98%||62.93%||13.13%|
Volatility & Risk
Western Refining Logistics has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500. Comparatively, Frontline has a beta of 1.89, suggesting that its stock price is 89% more volatile than the S&P 500.
Insider and Institutional Ownership
40.1% of Western Refining Logistics shares are held by institutional investors. Comparatively, 14.4% of Frontline shares are held by institutional investors. 48.1% of Frontline shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Western Refining Logistics Company Profile
Western Refining Logistics, LP owns, operates, develops, and acquires logistics and related assets and businesses to include terminals, storage tanks, pipelines and other logistics assets related to the terminaling, transportation, storage and distribution of crude oil and refined products. The Company’s segments include logistics and wholesale. The Company operates its logistics business and wholesale business under commercial and service agreements with Western Refining, Inc. (Western). Its logistics assets consist of pipeline and gathering infrastructure and terminalling, transportation and storage assets in the Southwest and the Upper Great Plains region. Its wholesale business purchases its petroleum fuels from Western, and its lubricants and additional petroleum fuels from third-party suppliers.
Frontline Company Profile
Frontline Ltd. is a shipping company. The Company is engaged in the seaborne transportation of crude oil and oil products. Its tankers segment includes crude oil tankers and product tankers. As of December 31, 2016, the Company’s fleet consisted of 28 vessels owned by the Company (seven very large crude carriers (VLCCs), 10 Suezmax tankers and 11 Aframax/LR2 tankers); 13 vessels that are under capital leases (11 VLCCs and two Suezmax tankers); one VLCC that is recorded as an investment in finance lease; four vessels chartered-in for periods of 12 months, including extension options (two VLCCs and two Suezmax tankers); two VLCCs where cost/revenue is split equally with a third party (of which one is chartered-in by it and one by a third party); three medium range product tankers that are chartered-in on short term time charters with a remaining duration of less than two months, and five vessels that are under commercial management (two Suezmax tankers and three Aframax oil tankers).
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