Analyzing Navigator (NYSE:NVGS) & Granite Ridge Resources (NYSE:GRNT)

Navigator (NYSE:NVGS) and Granite Ridge Resources (NYSE:GRNT) are both small-cap energy companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, earnings, profitability, analyst recommendations, risk, institutional ownership and valuation.

Institutional & Insider Ownership

19.0% of Navigator shares are held by institutional investors. Comparatively, 31.6% of Granite Ridge Resources shares are held by institutional investors. 0.4% of Navigator shares are held by insiders. Comparatively, 8.6% of Granite Ridge Resources shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Navigator has a beta of 0.48, suggesting that its stock price is 52% less volatile than the S&P 500. Comparatively, Granite Ridge Resources has a beta of 0.24, suggesting that its stock price is 76% less volatile than the S&P 500.

Dividends

Navigator pays an annual dividend of $0.28 per share and has a dividend yield of 1.2%. Granite Ridge Resources pays an annual dividend of $0.44 per share and has a dividend yield of 8.9%. Navigator pays out 12.9% of its earnings in the form of a dividend. Granite Ridge Resources pays out -209.5% 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. Navigator has raised its dividend for 1 consecutive years. Granite Ridge Resources is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Navigator and Granite Ridge Resources, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Navigator	0	1	4	0	2.80
Granite Ridge Resources	1	1	2	1	2.60

Navigator currently has a consensus target price of $23.00, suggesting a potential upside of 0.99%. Granite Ridge Resources has a consensus target price of $10.00, suggesting a potential upside of 103.05%. Given Granite Ridge Resources’ higher possible upside, analysts clearly believe Granite Ridge Resources is more favorable than Navigator.

Valuation and Earnings

This table compares Navigator and Granite Ridge Resources”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Navigator	$614.47 million	2.28	$100.12 million	$2.17	10.49
Granite Ridge Resources	$450.31 million	1.44	$24.35 million	($0.21)	-23.45

Navigator has higher revenue and earnings than Granite Ridge Resources. Granite Ridge Resources is trading at a lower price-to-earnings ratio than Navigator, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Navigator and Granite Ridge Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Navigator	22.80%	10.45%	5.73%
Granite Ridge Resources	-5.56%	4.67%	2.33%

Summary

Navigator beats Granite Ridge Resources on 12 of the 18 factors compared between the two stocks.

About Navigator

Navigator Holdings Ltd. engages in owning and operating a fleet of liquefied gas carriers worldwide. It provides international and regional seaborne transportation services of petrochemical gases, liquefied petroleum gases, and ammonia for energy companies, industrial users, and commodity traders. The company also offers ship shore infrastructure and consultancy services. It operates a fleet of 56 semi- or fully-refrigerated liquefied gas carriers. The company was formerly known as Isle of Man public limited company and changed its name to Navigator Holdings Ltd. in 2006. Navigator Holdings Ltd. was incorporated in 1997 and is based in London, the United Kingdom.

About Granite Ridge Resources

Granite Ridge Resources, Inc. operates as a non-operated oil and gas exploration and production company. It owns a portfolio of wells and acreage across the Permian and other unconventional basins in the United States. Granite Ridge Resources, Inc. is based in Dallas, Texas.