Safe Bulkers (NYSE:SB) & Flex LNG (NYSE:FLNG) Financial Contrast

Flex LNG (NYSE:FLNG) and Safe Bulkers (NYSE:SB) are both small-cap transportation companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, profitability, institutional ownership, valuation, dividends, analyst recommendations and risk.

Analyst Recommendations

This is a breakdown of recent ratings for Flex LNG and Safe Bulkers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Flex LNG	0	3	0	0	2.00
Safe Bulkers	0	2	2	0	2.50

Flex LNG currently has a consensus target price of $23.00, indicating a potential downside of 12.97%. Safe Bulkers has a consensus target price of $4.80, indicating a potential downside of 10.53%. Given Safe Bulkers’ stronger consensus rating and higher probable upside, analysts plainly believe Safe Bulkers is more favorable than Flex LNG.

Volatility and Risk

Flex LNG has a beta of 0.34, suggesting that its stock price is 66% less volatile than the S&P 500. Comparatively, Safe Bulkers has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500.

Earnings and Valuation

This table compares Flex LNG and Safe Bulkers”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Flex LNG	$356.35 million	4.00	$117.68 million	$1.83	14.44
Safe Bulkers	$307.63 million	1.78	$97.38 million	$0.36	14.90

Flex LNG has higher revenue and earnings than Safe Bulkers. Flex LNG is trading at a lower price-to-earnings ratio than Safe Bulkers, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Flex LNG and Safe Bulkers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Flex LNG	28.06%	14.04%	4.09%
Safe Bulkers	16.78%	5.18%	3.07%

Dividends

Flex LNG pays an annual dividend of $3.00 per share and has a dividend yield of 11.4%. Safe Bulkers pays an annual dividend of $0.20 per share and has a dividend yield of 3.7%. Flex LNG pays out 163.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Safe Bulkers pays out 55.6% of its earnings in the form of a dividend.

Institutional and Insider Ownership

21.7% of Safe Bulkers shares are owned by institutional investors. 0.3% of Flex LNG shares are owned by company insiders. Comparatively, 40.3% of Safe Bulkers shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

About Flex LNG

FLEX LNG Ltd. engages in the seaborne transportation of liquefied natural gas (LPG) through the ownership and operation of LNG carriers. The company was founded by Philip Eystein Fjeld, Trym Tveitnes and Jostein Ueland in September 2006 and is headquartered in Hamilton, Bermuda.

About Safe Bulkers

Safe Bulkers, Inc., together with its subsidiaries, provides marine drybulk transportation services. It owns and operates drybulk vessels for transporting bulk cargoes primarily coal, grain, and iron ore. The company has a fleet of 47 drybulk vessels having an aggregate carrying capacity of 4,719,600 deadweight tons. Its fleet consists of 10 Panamax class vessels, 11 Kamsarmax class vessels, 18 post-Panamax class vessels, and 8 Capesize class vessels. Safe Bulkers, Inc. was incorporated in 2007 and is based in Monaco.