Financial Contrast: Star Bulk Carriers Corp. (SBLK) versus Golden Ocean Group (GOGL)

Star Bulk Carriers Corp. (NASDAQ: SBLK) and Golden Ocean Group (NASDAQ:GOGL) are both small-cap transportation companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, earnings, valuation and risk.

Valuation & Earnings

This table compares Star Bulk Carriers Corp. and Golden Ocean Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Star Bulk Carriers Corp. $222.11 million 2.89 -$154.22 million ($1.86) -5.38
Golden Ocean Group $257.81 million 4.21 -$127.71 million ($0.40) -19.38

Golden Ocean Group has higher revenue and earnings than Star Bulk Carriers Corp.. Golden Ocean Group is trading at a lower price-to-earnings ratio than Star Bulk Carriers Corp., indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Star Bulk Carriers Corp. has a beta of 2.81, suggesting that its stock price is 181% more volatile than the S&P 500. Comparatively, Golden Ocean Group has a beta of 2.35, suggesting that its stock price is 135% more volatile than the S&P 500.

Profitability

This table compares Star Bulk Carriers Corp. and Golden Ocean Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Star Bulk Carriers Corp. -36.90% -5.54% -2.83%
Golden Ocean Group -14.69% -3.91% -2.02%

Institutional & Insider Ownership

74.1% of Star Bulk Carriers Corp. shares are owned by institutional investors. Comparatively, 9.8% of Golden Ocean Group shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and price targets for Star Bulk Carriers Corp. and Golden Ocean Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Star Bulk Carriers Corp. 0 1 6 0 2.86
Golden Ocean Group 0 1 6 0 2.86

Star Bulk Carriers Corp. presently has a consensus price target of $13.20, indicating a potential upside of 31.87%. Golden Ocean Group has a consensus price target of $11.33, indicating a potential upside of 46.24%. Given Golden Ocean Group’s higher probable upside, analysts clearly believe Golden Ocean Group is more favorable than Star Bulk Carriers Corp..

Summary

Golden Ocean Group beats Star Bulk Carriers Corp. on 8 of the 10 factors compared between the two stocks.

Star Bulk Carriers Corp. Company Profile

Star Bulk Carriers Corp. is an international shipping company. The Company owns and operates a fleet of dry bulk carrier vessels. As of December 31, 2016, the Company’s fleet included 73 vessels consisting primarily of Newcastlemax and Capesize, as well as Kamsarmax, Ultramax and Supramax vessels with a carrying capacity between 52,055 and 209,537 deadweight tonnage (dwt). The Company’s vessels transport a range of bulk commodities, including ores, coal, grains and fertilizers, along shipping routes across the world. The Company’s fleet, which emphasizes Capesize vessels, primarily transports minerals from the Americas and Australia to East Asia, particularly China, as well as Japan, South Korea, Taiwan, Indonesia and Malaysia. The Company’s Supramax vessels carry minerals, grain products and steel between the Americas, Europe, Africa, Australia and Indonesia, and from these areas to China, Japan, South Korea, Taiwan, the Philippines and Malaysia.

Golden Ocean Group Company Profile

Golden Ocean Group Limited, formerly Knightsbridge Shipping Limited, is an international dry bulk shipping company. The Company is engaged in the transportation of dry bulk cargoes. It owns and operates a fleet of dry bulk carrier vessels, focusing on the Capesize, Panamax and Supramax markets. Its vessels transport a range of major and minor bulk commodities, including ores, coal, grains and fertilizers. Its fleet includes owned vessels, bareboat vessels, chartered vessels, commercial management vessels and newbuildings. It owns over 40 dry bulk carriers and has contracts for over 20 newbuildings. It also has over 10 vessels chartered-in (of which over eight are chartered in from Ship Finance and over five are chartered in from third parties) and over one vessel chartered-in through a joint venture. Approximately six of the vessels are chartered-out on fixed rate time charters and the other operates in the spot market or fixed on index-linked time charter contracts.

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