Analyzing Frontline (NYSE:FRO) & Euronav (NYSE:CMBT)

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

Volatility & Risk

Euronav has a beta of -0.13, indicating that its stock price is 113% less volatile than the S&P 500. Comparatively, Frontline has a beta of 0.2, indicating that its stock price is 80% less volatile than the S&P 500.

Dividends

Euronav pays an annual dividend of $0.52 per share and has a dividend yield of 6.0%. Frontline pays an annual dividend of $0.80 per share and has a dividend yield of 5.6%. Euronav pays out 11.9% of its earnings in the form of a dividend. Frontline pays out 36.0% 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. Euronav is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Euronav and Frontline”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Euronav	$940.25 million	1.80	$858.03 million	$4.38	1.99
Frontline	$2.05 billion	1.56	$656.41 million	$2.22	6.45

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Euronav	117.02%	22.29%	10.17%
Frontline	25.64%	19.25%	7.19%

Institutional & Insider Ownership

22.7% of Frontline shares are held by institutional investors. 48.1% of Frontline shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Euronav and Frontline, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Euronav	0	0	0	0	0.00
Frontline	1	0	3	1	2.80

Frontline has a consensus price target of $23.62, indicating a potential upside of 64.90%. Given Frontline’s stronger consensus rating and higher possible upside, analysts clearly believe Frontline is more favorable than Euronav.

Summary

Frontline beats Euronav on 9 of the 17 factors compared between the two stocks.

About Euronav

Euronav NV, together with its subsidiaries, engages in the transportation and storage of crude oil worldwide. The company offers floating, storage, and offloading (FSO) services. It also owns and operates a fleet of vessels. The company was incorporated in 2003 and is headquartered in Antwerp, Belgium. As of March 15, 2024, Euronav NV operates as subsidiary of CMB NV.

About Frontline

Frontline plc, a shipping company, engages in the seaborne transportation of crude oil and oil products worldwide. It owns and operates oil and product tankers. As of December 31, 2022, the company operated a fleet of 70 vessels. It is also involved in the charter, purchase, and sale of vessels. The company was founded in 1985 and is based in Limassol, Cyprus.