Reviewing Teekay Tankers (NYSE:TNK) & Torm (NASDAQ:TRMD)

Teekay Tankers (NYSE:TNK) and Torm (NASDAQ:TRMD) are both mid-cap energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, risk, dividends, earnings and valuation.

Dividends

Teekay Tankers pays an annual dividend of $1.00 per share and has a dividend yield of 1.0%. Torm pays an annual dividend of $7.00 per share and has a dividend yield of 17.5%. Teekay Tankers pays out 5.9% of its earnings in the form of a dividend. Torm pays out 115.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Teekay Tankers has raised its dividend for 2 consecutive years.

Risk and Volatility

Teekay Tankers has a beta of -0.09, suggesting that its stock price is 109% less volatile than the S&P 500. Comparatively, Torm has a beta of 0.07, suggesting that its stock price is 93% less volatile than the S&P 500.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Teekay Tankers	$1.15 billion	3.09	$351.19 million	$16.97	6.08
Torm	$1.76 billion	2.32	$285.30 million	$6.07	6.59

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

Insider & Institutional Ownership

52.7% of Teekay Tankers shares are held by institutional investors. Comparatively, 73.9% of Torm shares are held by institutional investors. 1.9% of Teekay Tankers shares are held by insiders. Comparatively, 0.4% of Torm shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Teekay Tankers and Torm’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%
Torm	35.51%	27.24%	17.96%

Analyst Ratings

This is a summary of current ratings and target prices for Teekay Tankers and Torm, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Teekay Tankers	1	3	3	1	2.50
Torm	0	2	1	1	2.75

Teekay Tankers currently has a consensus price target of $77.00, indicating a potential downside of 25.40%. Torm has a consensus price target of $38.00, indicating a potential downside of 5.00%. Given Torm’s stronger consensus rating and higher probable upside, analysts clearly believe Torm is more favorable than Teekay Tankers.

Summary

Teekay Tankers beats Torm on 9 of the 17 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 Torm

TORM plc, a shipping company, owns and operates a fleet of product tankers in the United Kingdom. It operates in two operating segments, Tanker and Marine Exhaust. The Tanker segment transports refined oil products, such as gasoline, jet fuel, kerosene, naphtha, and gas oil, as well as dirty petroleum products, including fuel oil. The Marine Exhaust segment engages in developing and producing advanced and green marine equipment. TORM plc was founded in 1889 and is based in London, the United Kingdom.