Tsakos Energy Navigation (NYSE:TEN) & KNOT Offshore Partners (NYSE:KNOP) Critical Analysis

Tsakos Energy Navigation (NYSE:TEN) and KNOT Offshore Partners (NYSE:KNOP) are both small-cap transportation companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, valuation, profitability, dividends and institutional ownership.

Earnings & Valuation

This table compares Tsakos Energy Navigation and KNOT Offshore Partners”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tsakos Energy Navigation	$798.69 million	1.67	$160.90 million	$4.46	9.91
KNOT Offshore Partners	$364.44 million	1.06	$22.96 million	$0.68	16.81

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

Risk & Volatility

Tsakos Energy Navigation has a beta of -0.27, indicating that its stock price is 127% less volatile than the S&P 500. Comparatively, KNOT Offshore Partners has a beta of -0.07, indicating that its stock price is 107% less volatile than the S&P 500.

Dividends

Tsakos Energy Navigation pays an annual dividend of $1.00 per share and has a dividend yield of 2.3%. KNOT Offshore Partners pays an annual dividend of $0.20 per share and has a dividend yield of 1.7%. Tsakos Energy Navigation pays out 22.4% of its earnings in the form of a dividend. KNOT Offshore Partners pays out 29.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Tsakos Energy Navigation is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of current ratings for Tsakos Energy Navigation and KNOT Offshore Partners, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tsakos Energy Navigation	0	3	1	0	2.25
KNOT Offshore Partners	0	3	1	1	2.60

Tsakos Energy Navigation currently has a consensus price target of $29.50, suggesting a potential downside of 33.25%. KNOT Offshore Partners has a consensus price target of $14.00, suggesting a potential upside of 22.48%. Given KNOT Offshore Partners’ stronger consensus rating and higher possible upside, analysts clearly believe KNOT Offshore Partners is more favorable than Tsakos Energy Navigation.

Insider and Institutional Ownership

19.2% of Tsakos Energy Navigation shares are owned by institutional investors. Comparatively, 26.8% of KNOT Offshore Partners shares are owned by institutional investors. 1.4% of Tsakos Energy Navigation shares are owned by 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 Tsakos Energy Navigation and KNOT Offshore Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tsakos Energy Navigation	20.15%	17.26%	8.11%
KNOT Offshore Partners	6.38%	7.30%	2.35%

Summary

Tsakos Energy Navigation beats KNOT Offshore Partners on 10 of the 16 factors compared between the two stocks.

About Tsakos Energy Navigation

Tsakos Energy Navigation Ltd. engages in the provision of seaborne crude oil and petroleum product transportation services. Its activities include the operation of crude tankers, product tankers, and liquefied natural gas carriers. The company was founded by Nikolas P. Tsakos and Michael Gordon Jolliffee in July 1993 and is headquartered in Athens, Greece.

About KNOT Offshore Partners

KNOT Offshore Partners LP acquires, owns, and operates shuttle tankers under long-term charters in the North Sea and Brazil. The company provides loading, transportation, and discharge of crude oil under time charters and bareboat charters. The company was founded in 2013 and is headquartered in Aberdeen, the United Kingdom.