Global Ship Lease (NYSE:GSL) and Nordic American Tankers (NYSE:NAT) Financial Review

Nordic American Tankers (NYSE:NAT) and Global Ship Lease (NYSE:GSL) are both small-cap transportation companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, valuation, analyst recommendations, profitability, earnings, dividends and institutional ownership.

Profitability

This table compares Nordic American Tankers and Global Ship Lease’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nordic American Tankers	6.39%	2.47%	1.28%
Global Ship Lease	54.33%	22.35%	13.99%

Dividends

Nordic American Tankers pays an annual dividend of $0.68 per share and has a dividend yield of 12.2%. Global Ship Lease pays an annual dividend of $2.50 per share and has a dividend yield of 6.1%. Nordic American Tankers pays out 971.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Global Ship Lease pays out 21.9% of its earnings in the form of a dividend. Nordic American Tankers has increased its dividend for 1 consecutive years and Global Ship Lease has increased its dividend for 2 consecutive years.

Valuation & Earnings

This table compares Nordic American Tankers and Global Ship Lease”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nordic American Tankers	$182.54 million	6.49	$12.27 million	$0.07	79.89
Global Ship Lease	$766.45 million	1.93	$416.45 million	$11.39	3.61

Global Ship Lease has higher revenue and earnings than Nordic American Tankers. Global Ship Lease 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.

Risk and Volatility

Nordic American Tankers has a beta of -0.54, meaning that its stock price is 154% less volatile than the S&P 500. Comparatively, Global Ship Lease has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500.

Insider and Institutional Ownership

44.3% of Nordic American Tankers shares are held by institutional investors. Comparatively, 50.1% of Global Ship Lease shares are held by institutional investors. 2.9% of Nordic American Tankers shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings for Nordic American Tankers and Global Ship Lease, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nordic American Tankers	1	2	0	0	1.67
Global Ship Lease	0	2	3	1	2.83

Nordic American Tankers currently has a consensus target price of $4.00, suggesting a potential downside of 28.47%. Global Ship Lease has a consensus target price of $40.33, suggesting a potential downside of 1.88%. Given Global Ship Lease’s stronger consensus rating and higher possible upside, analysts clearly believe Global Ship Lease is more favorable than Nordic American Tankers.

Summary

Global Ship Lease beats Nordic American Tankers on 14 of the 18 factors compared between the two stocks.

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.

About Global Ship Lease

Global Ship Lease, Inc., together with its subsidiaries, engages in owning and chartering of containerships under fixed-rate charters to container shipping companies worldwide. As of March 11, 2024, it owned 68 mid-sized and smaller containerships, ranging from 2,207 to 11,040 twenty-foot equivalent unit (TEU), with an aggregate capacity of 375,406 TEU. The company was founded in 2007 and is based in Athens, Greece.