Financial Survey: Ultrapar Participacoes (NYSE:UGP) versus Nordic American Tankers (NYSE:NAT)

Ultrapar Participacoes (NYSE:UGP) and Nordic American Tankers (NYSE:NAT) are both energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, profitability, analyst recommendations and valuation.

Insider & Institutional Ownership

3.6% of Ultrapar Participacoes shares are held by institutional investors. Comparatively, 44.3% of Nordic American Tankers shares are held by institutional investors. 1.8% of Ultrapar Participacoes shares are held by company insiders. Comparatively, 2.9% of Nordic American Tankers shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Ultrapar Participacoes and Nordic American Tankers”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ultrapar Participacoes	$25.51 billion	0.34	$439.48 million	$0.61	12.78
Nordic American Tankers	$182.54 million	8.75	$12.27 million	$0.59	12.79

Ultrapar Participacoes has higher revenue and earnings than Nordic American Tankers. Ultrapar Participacoes is trading at a lower price-to-earnings ratio than Nordic American Tankers, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ultrapar Participacoes and Nordic American Tankers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ultrapar Participacoes	2.28%	18.84%	7.17%
Nordic American Tankers	47.04%	20.58%	10.38%

Analyst Ratings

This is a breakdown of current recommendations for Ultrapar Participacoes and Nordic American Tankers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ultrapar Participacoes	0	5	3	1	2.56
Nordic American Tankers	1	2	1	0	2.00

Ultrapar Participacoes currently has a consensus target price of $6.54, indicating a potential downside of 16.10%. Nordic American Tankers has a consensus target price of $6.00, indicating a potential downside of 20.48%. Given Ultrapar Participacoes’ stronger consensus rating and higher probable upside, research analysts plainly believe Ultrapar Participacoes is more favorable than Nordic American Tankers.

Volatility & Risk

Ultrapar Participacoes has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500. Comparatively, Nordic American Tankers has a beta of -0.56, meaning that its share price is 156% less volatile than the S&P 500.

Dividends

Ultrapar Participacoes pays an annual dividend of $0.31 per share and has a dividend yield of 4.0%. Nordic American Tankers pays an annual dividend of $1.08 per share and has a dividend yield of 14.3%. Ultrapar Participacoes pays out 50.8% of its earnings in the form of a dividend. Nordic American Tankers pays out 183.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Nordic American Tankers has raised its dividend for 1 consecutive years. Nordic American Tankers is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Ultrapar Participacoes beats Nordic American Tankers on 10 of the 18 factors compared between the two stocks.

About Ultrapar Participacoes

Ultrapar Participações S.A., through its subsidiaries, operates in the energy and infrastructure business in Brazil. The company distributes liquefied petroleum gas to residential, commercial, and industrial consumers, in addition to renewable electricity and compressed natural gas. It also operates in the distribution and marketing of gasoline, ethanol, diesel, fuel oil, kerosene, natural gas for vehicles, and lubricants; and holds AmPm convenience stores and provides JetOil lubricant services. In addition, the company operates liquid bulk storage terminals. Further, it offers digital payments services, combining the abastece aí app and the loyalty program Km de Vantagens. It also exports its products and services to customers in Europe, Singapore, the United States, Canada, other Latin American countries, and internationally. The company was founded in 1937 and is headquartered in São Paulo, Brazil.

About Nordic American Tankers

Nordic American Tankers Limited, a tanker company, acquires and charters double-hull tankers in Bermuda and internationally. It operates a fleet of 20 Suezmax crude oil tankers. The company was incorporated in 1995 and is headquartered in Hamilton, Bermuda.