Teekay LNG Partners L.P. (NYSE: TGP) and Navigator Holdings (NYSE:NVGS) are both small-cap transportation companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, institutional ownership, risk, analyst recommendations and profitability.

Dividends

Teekay LNG Partners L.P. pays an annual dividend of $0.56 per share and has a dividend yield of 3.1%. Navigator Holdings does not pay a dividend. Teekay LNG Partners L.P. pays out 32.7% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Teekay LNG Partners L.P. and Navigator Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Teekay LNG Partners L.P. 0 3 1 0 2.25
Navigator Holdings 1 0 5 0 2.67

Teekay LNG Partners L.P. currently has a consensus price target of $16.50, suggesting a potential downside of 8.59%. Navigator Holdings has a consensus price target of $14.00, suggesting a potential upside of 23.89%. Given Navigator Holdings’ stronger consensus rating and higher probable upside, analysts plainly believe Navigator Holdings is more favorable than Teekay LNG Partners L.P..

Insider & Institutional Ownership

38.1% of Teekay LNG Partners L.P. shares are held by institutional investors. Comparatively, 67.0% of Navigator Holdings shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Teekay LNG Partners L.P. has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500. Comparatively, Navigator Holdings has a beta of 1.09, indicating that its stock price is 9% more volatile than the S&P 500.

Profitability

This table compares Teekay LNG Partners L.P. and Navigator Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Teekay LNG Partners L.P. 38.28% 6.12% 2.25%
Navigator Holdings 6.44% 2.28% 1.25%

Earnings and Valuation

This table compares Teekay LNG Partners L.P. and Navigator Holdings’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Teekay LNG Partners L.P. $403.52 million 3.56 $279.27 million $1.71 10.56
Navigator Holdings $296.90 million 2.11 $119.59 million $0.35 32.29

Teekay LNG Partners L.P. has higher revenue and earnings than Navigator Holdings. Teekay LNG Partners L.P. is trading at a lower price-to-earnings ratio than Navigator Holdings, indicating that it is currently the more affordable of the two stocks.

Summary

Teekay LNG Partners L.P. beats Navigator Holdings on 9 of the 15 factors compared between the two stocks.

About Teekay LNG Partners L.P.

Teekay LNG Partners L.P. is an international provider of marine transportation services for liquefied natural gas (LNG), liquefied petroleum gas (LPG) and crude oil. The Company’s fleet, excluding newbuildings, consists of approximately 30 LNG carriers (including the six MALT LNG Carriers, four RasGas 3 LNG Carriers, four Angola LNG Carriers and two Exmar LNG Carriers), over 20 LPG carriers (including 20 Exmar LPG Carriers), approximately seven Suezmax-class crude oil tankers and a Handymax product tanker, all of which are double-hulled. Its segments include liquefied gas segment and conventional tanker segment. The liquefied gas segment consists of LNG carriers, LPG carriers and multigas carriers, which can carry both LNG and LPG. The conventional tanker segment consists of approximately seven Suezmax-class crude oil tankers and a Handymax product tanker. Its vessels primarily operate under long-term, fixed-rate charters with energy and utility companies, and Teekay Corporation.

About Navigator Holdings

Navigator Holdings Ltd. is an owner and operator of a fleet of handysize liquefied gas carriers. The Company provides international and regional seaborne transportation services of liquefied petroleum gas (LPG), petrochemical gases and ammonia. As of December 31, 2016, it had 33 semi- or fully-refrigerated handysize liquefied gas carriers. Its handysize liquefied gas carriers are liquefied gas carriers with capabilities between 15,000 and 24,999 cubic meter (cbm). Its handysize liquefied gas carriers can accommodate medium- and long-haul routes. In addition, it had four midsize 37,300 cbm ethylene-capable semi-refrigerated liquefied gas carriers as of December 31, 2016. Its midsize ethylene-capable semi-refrigerated gas carriers enable long-haul transportation of ethane/ethylene. As of December 31, 2016, it also had one 38,000 cbm fully refrigerated gas carrier. The Company carries LPG for international energy companies, state-owned utilities and commodities traders.

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