Analyzing HF Sinclair (NYSE:DINO) & Teekay Tankers (NYSE:TNK)

Teekay Tankers (NYSE:TNK) and HF Sinclair (NYSE:DINO) are both energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Dividends

Teekay Tankers pays an annual dividend of $1.00 per share and has a dividend yield of 1.0%. HF Sinclair pays an annual dividend of $2.10 per share and has a dividend yield of 2.0%. Teekay Tankers pays out 5.9% of its earnings in the form of a dividend. HF Sinclair pays out 20.0% 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. Teekay Tankers has increased its dividend for 2 consecutive years and HF Sinclair has increased its dividend for 3 consecutive years. HF Sinclair is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

52.7% of Teekay Tankers shares are owned by institutional investors. Comparatively, 88.3% of HF Sinclair shares are owned by institutional investors. 1.9% of Teekay Tankers shares are owned by insiders. Comparatively, 0.3% of HF Sinclair shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Teekay Tankers and HF Sinclair’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Teekay Tankers	51.35%	22.11%	20.23%
HF Sinclair	6.13%	18.21%	9.96%

Analyst Recommendations

This is a summary of recent ratings and target prices for Teekay Tankers and HF Sinclair, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Teekay Tankers	1	3	3	1	2.50
HF Sinclair	1	7	6	2	2.56

Teekay Tankers presently has a consensus target price of $77.00, suggesting a potential downside of 22.87%. HF Sinclair has a consensus target price of $94.25, suggesting a potential downside of 11.84%. Given HF Sinclair’s stronger consensus rating and higher probable upside, analysts plainly believe HF Sinclair is more favorable than Teekay Tankers.

Volatility and Risk

Teekay Tankers has a beta of -0.19, indicating that its stock price is 119% less volatile than the S&P 500. Comparatively, HF Sinclair has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500.

Earnings & Valuation

This table compares Teekay Tankers and HF Sinclair”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Teekay Tankers	$951.80 million	3.62	$351.19 million	$16.97	5.88
HF Sinclair	$31.23 billion	0.61	$579.00 million	$10.48	10.20

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

Summary

HF Sinclair beats Teekay Tankers on 11 of the 18 factors compared between the two stocks.

About Teekay Tankers

Teekay Tankers Ltd. provides crude oil and other marine transportation services to oil industries in Bermuda and internationally. The company offers voyage and time charter services; offshore ship-to-ship transfer services of commodities primarily crude oil and refined oil products; and tanker commercial and technical management services. It also engages management of vessels, procurement, and equipment rental businesses. Teekay Tankers Ltd. was incorporated in 2007 and is headquartered in Hamilton, Bermuda.

About HF Sinclair

HF Sinclair Corporation operates as an independent energy company. The company produces and markets gasoline, diesel fuel, jet fuel, renewable diesel, specialty lubricant products, specialty chemicals, specialty and modified asphalt, and others. It owns and operates refineries located in Kansas, Oklahoma, New Mexico, Utah, Washington, and Wyoming; and markets its refined products principally in the Southwest United States and Rocky Mountains, Pacific Northwest, and in other neighboring Plains states. In addition, the company supplies fuels to approximately 1,500 independent Sinclair branded stations and licenses the use of the Sinclair brand at approximately 300 additional locations. Further, it produces base oils and other specialized lubricants; and provides petroleum product and crude oil transportation, terminalling, storage, and throughput services to the petroleum sector. HF Sinclair Corporation is headquartered in Dallas, Texas.