Head-To-Head Contrast: Danaos (NYSE:DAC) vs. Safe Bulkers (NYSE:SB)

Danaos (NYSE:DAC) and Safe Bulkers (NYSE:SB) are both industrials companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, risk, profitability, analyst recommendations, institutional ownership and valuation.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Danaos	51.26%	13.20%	10.08%
Safe Bulkers	28.29%	9.63%	5.77%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Danaos and Safe Bulkers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Danaos	0	0	0	3	4.00
Safe Bulkers	0	1	1	0	2.50

Safe Bulkers has a consensus price target of $6.00, suggesting a potential downside of 25.19%. Given Safe Bulkers’ higher possible upside, analysts plainly believe Safe Bulkers is more favorable than Danaos.

Institutional & Insider Ownership

19.0% of Danaos shares are owned by institutional investors. Comparatively, 21.7% of Safe Bulkers shares are owned by institutional investors. 41.0% of Danaos 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 hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Danaos has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, Safe Bulkers has a beta of 0.97, suggesting that its share price is 3% less volatile than the S&P 500.

Earnings and Valuation

This table compares Danaos and Safe Bulkers”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Danaos	$1.04 billion	2.75	$494.61 million	$29.55	5.32
Safe Bulkers	$307.50 million	2.66	$38.56 million	$0.78	10.28

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

Dividends

Danaos pays an annual dividend of $4.00 per share and has a dividend yield of 2.5%. Safe Bulkers pays an annual dividend of $0.30 per share and has a dividend yield of 3.7%. Danaos pays out 13.5% of its earnings in the form of a dividend. Safe Bulkers pays out 38.5% 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. Danaos has increased its dividend for 3 consecutive years.

Summary

Danaos beats Safe Bulkers on 12 of the 18 factors compared between the two stocks.

About Danaos

Danaos Corporation, together with its subsidiaries, provides container and drybulk vessels services in Australia, Asia, and Europe. The company offers seaborne transportation services by operating vessels in the containership and drybulk sectors of the shipping industry. As of April 03, 2024, it had a fleet of 68 containerships aggregating 421,293 twenty-foot equivalent units in capacity. The company was formerly known as Danaos Holdings Limited and changed its name to Danaos Corporation in October 2005. Danaos Corporation was founded in 1963 and is based in Piraeus, Greece.

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.