Analyzing Euronav (NYSE:CMBT) & TORM (NASDAQ:TRMD)

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

Dividends

TORM pays an annual dividend of $3.50 per share and has a dividend yield of 18.1%. Euronav pays an annual dividend of $0.52 per share and has a dividend yield of 5.2%. TORM pays out 45.3% of its earnings in the form of a dividend. Euronav pays out 8.8% 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.

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TORM	0	1	2	0	2.67
Euronav	0	0	0	0	0.00

TORM currently has a consensus price target of $40.00, suggesting a potential upside of 106.83%. Given TORM’s stronger consensus rating and higher possible upside, equities research analysts plainly believe TORM is more favorable than Euronav.

Valuation & Earnings

This table compares TORM and Euronav”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TORM	$1.64 billion	0.96	$648.27 million	$7.73	2.50
Euronav	$982.85 million	1.98	$858.03 million	$5.93	1.69

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
TORM	43.81%	34.45%	20.31%
Euronav	117.02%	22.29%	10.17%

Volatility & Risk

TORM has a beta of 0.21, suggesting that its stock price is 79% less volatile than the S&P 500. Comparatively, Euronav has a beta of -0.12, suggesting that its stock price is 112% less volatile than the S&P 500.

Institutional & Insider Ownership

73.9% of TORM shares are owned by institutional investors. 0.4% of TORM shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

TORM beats Euronav on 12 of the 16 factors compared between the two stocks.

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.

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.