Financial Survey: Diana Shipping (DSX) versus Frontline (FRO)


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

Profitability

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This table compares Diana Shipping and Frontline’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Diana Shipping -272.83% -7.11% -4.08%
Frontline -47.83% -3.37% -1.41%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Diana Shipping and Frontline, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Diana Shipping 0 7 1 0 2.13
Frontline 1 2 2 0 2.20

Diana Shipping presently has a consensus price target of $4.75, indicating a potential upside of 0.00%. Frontline has a consensus price target of $5.33, indicating a potential downside of 5.10%. Given Diana Shipping’s higher probable upside, equities research analysts plainly believe Diana Shipping is more favorable than Frontline.


Earnings & Valuation

This table compares Diana Shipping and Frontline’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Diana Shipping $161.90 million 3.11 -$511.71 million ($0.79) -6.01
Frontline $646.33 million 1.48 -$264.86 million ($0.03) -187.33

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

Dividends

Frontline pays an annual dividend of $0.15 per share and has a dividend yield of 2.7%. Diana Shipping does not pay a dividend. Frontline pays out -500.0% of its earnings in the form of a dividend. Frontline has increased its dividend for 2 consecutive years.

Volatility & Risk

Diana Shipping has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500. Comparatively, Frontline has a beta of 1.81, meaning that its stock price is 81% more volatile than the S&P 500.


Insider & Institutional Ownership

38.5% of Diana Shipping shares are held by institutional investors. Comparatively, 14.5% of Frontline shares are held by institutional investors. 48.1% of Frontline shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Frontline beats Diana Shipping on 13 of the 17 factors compared between the two stocks.

About Diana Shipping

Diana Shipping Inc. provides shipping transportation services. The company transports a range of dry bulk cargoes, including iron ore, coal, and grains, as well as steel products, cement, and fertilizers through its ownership of dry bulk vessels worldwide. As of December 31, 2017, it operated a fleet of 50 dry bulk carriers, including 22 Panamax, 5 Kamsarmax, 5 Post-Panamax, 14 Capesize, and 4 Newcastlemax vessels. The company was formerly known as Diana Shipping Investments Corp. and changed its name to Diana Shipping Inc. in February 2005. Diana Shipping Inc. was founded in 1999 and is based in Athens, Greece.


About Frontline

Frontline Ltd., a shipping company, engages in the seaborne transportation of crude oil and oil products worldwide. As of December 31, 2017, the company's fleet consisted of 61 vessels, including VLCC, Suezmax, and LR2/Aframax tankers with an aggregate capacity of approximately 11.6 million deadweight ton. It is also involved in the charter, purchase, and sale of vessels. The company is based in Hamilton, Bermuda.