Analyzing Peabody Energy (NYSE:BTU) & Nordic American Tankers (NYSE:NAT)

Peabody Energy (NYSE:BTU) and Nordic American Tankers (NYSE:NAT) are both energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, dividends, risk and profitability.

Earnings and Valuation

This table compares Peabody Energy and Nordic American Tankers”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Peabody Energy	$3.86 billion	0.79	-$52.90 million	($1.50)	-16.75
Nordic American Tankers	$182.54 million	9.54	$12.27 million	$0.59	13.94

Nordic American Tankers has lower revenue, but higher earnings than Peabody Energy. Peabody Energy is trading at a lower price-to-earnings ratio than Nordic American Tankers, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Peabody Energy has a beta of 0.34, indicating that its stock price is 66% less volatile than the S&P 500. Comparatively, Nordic American Tankers has a beta of -0.54, indicating that its stock price is 154% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for Peabody Energy and Nordic American Tankers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Peabody Energy	2	2	2	0	2.00
Nordic American Tankers	1	2	2	0	2.20

Peabody Energy currently has a consensus price target of $33.88, suggesting a potential upside of 34.80%. Nordic American Tankers has a consensus price target of $5.33, suggesting a potential downside of 35.16%. Given Peabody Energy’s higher probable upside, analysts clearly believe Peabody Energy is more favorable than Nordic American Tankers.

Dividends

Peabody Energy pays an annual dividend of $0.30 per share and has a dividend yield of 1.2%. Nordic American Tankers pays an annual dividend of $1.08 per share and has a dividend yield of 13.1%. Peabody Energy pays out -20.0% of its earnings in the form of a dividend. Nordic American Tankers pays out 183.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Peabody Energy has increased its dividend for 1 consecutive years and Nordic American Tankers has increased its dividend for 1 consecutive years.

Insider and Institutional Ownership

87.4% of Peabody Energy shares are owned by institutional investors. Comparatively, 44.3% of Nordic American Tankers shares are owned by institutional investors. 0.5% of Peabody Energy shares are owned by insiders. Comparatively, 2.9% of Nordic American Tankers shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Peabody Energy and Nordic American Tankers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Peabody Energy	-4.56%	-5.22%	-3.22%
Nordic American Tankers	47.04%	20.58%	10.38%

Summary

Nordic American Tankers beats Peabody Energy on 10 of the 15 factors compared between the two stocks.

About Peabody Energy

Peabody Energy Corporation engages in coal mining business in the United States, Japan, Taiwan, Australia, India, Brazil, Belgium, Chile, France, Indonesia, China, Vietnam, South Korea, Germany, and internationally. The company operates through Seaborne Thermal, Seaborne Metallurgical, Powder River Basin, Other U.S. Thermal, and Corporate and Other segments. It is involved in the mining, preparation, and sale of thermal coal primarily to electric utilities; mining bituminous and sub-bituminous coal deposits; low sulfur and high British thermal unit thermal coal; and mining metallurgical coal, such as hard coking coal, semi-hard coking coal, semi-soft coking coal, and pulverized coal injection coal. The company supplies coal primarily to electricity generators, industrial facilities, and steel manufacturers. It also engages in marketing and brokering of coal from other coal producers; trading of coal and freight-related contracts, as well as provides transportation-related services. The company was founded in 1883 and is headquartered in Saint Louis, Missouri.

About Nordic American Tankers

Nordic American Tankers Limited, a tanker company, acquires and charters double-hull tankers in Bermuda and internationally. It operates a fleet of 20 Suezmax crude oil tankers. The company was incorporated in 1995 and is headquartered in Hamilton, Bermuda.