Head to Head Contrast: Frontline (FRO) & General Maritime (GNRT)

Frontline (NYSE: FRO) and General Maritime (NYSE:GNRT) are both small-cap transportation companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, risk, profitability, institutional ownership, earnings and dividends.

Dividends

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Frontline pays an annual dividend of $0.15 per share and has a dividend yield of 3.1%. General Maritime does not pay a dividend. Frontline pays out -500.0% of its earnings in the form of a dividend. Frontline has raised its dividend for 2 consecutive years.

Risk and Volatility

Frontline has a beta of 1.68, meaning that its stock price is 68% more volatile than the S&P 500. Comparatively, General Maritime has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.

Earnings & Valuation

This table compares Frontline and General Maritime’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Frontline $646.33 million 1.26 -$264.86 million ($0.03) -159.33
General Maritime $298.37 million 1.72 -$168.54 million ($0.25) -24.60

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

Institutional & Insider Ownership

14.4% of Frontline shares are held by institutional investors. Comparatively, 69.4% of General Maritime shares are held by institutional investors. 48.1% of Frontline shares are held by company insiders. Comparatively, 13.7% of General Maritime shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Frontline and General Maritime’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Frontline -40.98% -0.31% -0.14%
General Maritime -56.54% -1.55% -0.74%

Analyst Recommendations

This is a summary of recent recommendations for Frontline and General Maritime, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Frontline 1 1 2 0 2.25
General Maritime 0 3 2 0 2.40

Frontline currently has a consensus price target of $5.67, indicating a potential upside of 18.55%. General Maritime has a consensus price target of $7.92, indicating a potential upside of 28.73%. Given General Maritime’s stronger consensus rating and higher probable upside, analysts clearly believe General Maritime is more favorable than Frontline.

Summary

Frontline beats General Maritime on 10 of the 16 factors compared between the two stocks.

About Frontline

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).

About General Maritime

Gener8 Maritime, Inc. provides international seaborne crude oil and petroleum products transportation services. As of March 14, 2018, it had a fleet of 30 vessels comprising 21 very large crude carriers, 6 Suezmaxes, 1 Aframax, and 2 Panamax tankers with a total carrying capacity of approximately 7.5 million deadweight tons. The company was formerly known as General Maritime Corporation and changed its name to Gener8 Maritime, Inc. in May 2015. Gener8 Maritime, Inc. was founded in 1997 and is based in New York, New York.

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