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

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

Institutional & Insider Ownership

50.1% of Global Ship Lease shares are held by institutional investors. Comparatively, 44.3% of Nordic American Tankers 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 endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

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

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

Dividends

Global Ship Lease pays an annual dividend of $2.50 per share and has a dividend yield of 6.1%. Nordic American Tankers pays an annual dividend of $0.68 per share and has a dividend yield of 12.2%. Global Ship Lease pays out 21.9% of its earnings in the form of a dividend. 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 has increased its dividend for 2 consecutive years and Nordic American Tankers has increased its dividend for 1 consecutive years.

Valuation & Earnings

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

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

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.

Analyst Ratings

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

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

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

Risk & Volatility

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

Summary

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

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.

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.