SFL (NYSE:SFL) & Golar LNG (NASDAQ:GLNG) Head to Head Review

SFL (NYSE:SFL) and Golar LNG (NASDAQ:GLNG) are both energy companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, earnings, risk, profitability, analyst recommendations, institutional ownership and dividends.

Institutional & Insider Ownership

28.6% of SFL shares are held by institutional investors. Comparatively, 92.2% of Golar LNG shares are held by institutional investors. 0.0% of Golar LNG shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for SFL and Golar LNG, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SFL	0	1	2	0	2.67
Golar LNG	0	2	4	1	2.86

SFL presently has a consensus price target of $14.00, suggesting a potential upside of 8.95%. Golar LNG has a consensus price target of $63.00, suggesting a potential upside of 20.87%. Given Golar LNG’s stronger consensus rating and higher probable upside, analysts clearly believe Golar LNG is more favorable than SFL.

Profitability

This table compares SFL and Golar LNG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SFL	8.76%	3.41%	0.92%
Golar LNG	31.27%	8.91%	3.75%

Risk and Volatility

SFL has a beta of 0.4, meaning that its share price is 60% less volatile than the S&P 500. Comparatively, Golar LNG has a beta of 0.05, meaning that its share price is 95% less volatile than the S&P 500.

Valuation & Earnings

This table compares SFL and Golar LNG”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SFL	$733.04 million	2.53	-$26.43 million	$0.48	26.77
Golar LNG	$393.52 million	13.42	$65.68 million	$1.60	32.57

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

Dividends

SFL pays an annual dividend of $0.88 per share and has a dividend yield of 6.8%. Golar LNG pays an annual dividend of $1.00 per share and has a dividend yield of 1.9%. SFL pays out 183.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Golar LNG pays out 62.5% of its earnings in the form of a dividend. SFL has increased its dividend for 1 consecutive years and Golar LNG has increased its dividend for 2 consecutive years.

Summary

Golar LNG beats SFL on 15 of the 18 factors compared between the two stocks.

About SFL

SFL Corporation Ltd., a maritime and offshore asset owning and chartering company, engages in the ownership, operation, and chartering out of vessels and offshore related assets on medium and long-term charters. The company operates in various sectors of the maritime, and shipping and offshore industries, including oil transportation, dry bulk shipments, chemical transportation, oil products transportation, container transportation, car transportation, and drilling rigs. As of December 31, 2023, the company owned seven crude oil carriers, six oil product tankers, 15 dry bulk carriers, 32 container vessels, one jack-up drilling rig, one ultra-deepwater drilling rig, and five car carriers. It primarily operates in Bermuda, Canada, Cyprus, Liberia, Namibia, Norway, Singapore, the United Kingdom, and the Marshall Islands. The company was formerly known as Ship Finance International Limited and changed its name to SFL Corporation Ltd. in September 2019. SFL Corporation Ltd. was founded in 2003 and is based in Hamilton, Bermuda.

About Golar LNG

Golar LNG Limited designs, converts, owns, and operates marine infrastructure for the liquefaction of natural gas. The company operates through three segments: FLNG, Corporate and Other, and Shipping. It engages in the regasification, storage, and offloading of liquefied natural gas (LNG); operation of floating liquefaction natural gas (FLNG) vessels or projects; transportation of LNG carriers; and vessel management activities. Golar LNG Limited was founded in 1946 and is headquartered in Hamilton, Bermuda.