Golden Ocean Group Limited (NASDAQ: GOGL) and Costamare (NYSE:CMRE) are both small-cap transportation companies, but which is the better investment? We will contrast the two companies based on the strength of their profitabiliy, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.
Profitability
This table compares Golden Ocean Group Limited and Costamare’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Golden Ocean Group Limited | -26.08% | -5.71% | -2.98% |
| Costamare | 12.70% | 8.94% | 3.83% |
Valuation and Earnings
This table compares Golden Ocean Group Limited and Costamare’s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Golden Ocean Group Limited | $294.62 million | 3.34 | $49.02 million | ($0.73) | -10.81 |
| Costamare | $438.93 million | 1.45 | $279.67 million | $0.38 | 17.37 |
Costamare has higher revenue and earnings than Golden Ocean Group Limited. Golden Ocean Group Limited is trading at a lower price-to-earnings ratio than Costamare, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of current ratings and target prices for Golden Ocean Group Limited and Costamare, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Golden Ocean Group Limited | 0 | 1 | 6 | 0 | 2.86 |
| Costamare | 0 | 4 | 3 | 0 | 2.43 |
Golden Ocean Group Limited currently has a consensus target price of $9.75, suggesting a potential upside of 23.57%. Costamare has a consensus target price of $8.50, suggesting a potential upside of 28.79%. Given Costamare’s higher probable upside, analysts clearly believe Costamare is more favorable than Golden Ocean Group Limited.
Institutional and Insider Ownership
12.2% of Golden Ocean Group Limited shares are held by institutional investors. Comparatively, 19.0% of Costamare shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Volatility and Risk
Golden Ocean Group Limited has a beta of 2.36, meaning that its stock price is 136% more volatile than the S&P 500. Comparatively, Costamare has a beta of 2.21, meaning that its stock price is 121% more volatile than the S&P 500.
Dividends
Costamare pays an annual dividend of $0.40 per share and has a dividend yield of 6.1%. Golden Ocean Group Limited does not pay a dividend. Costamare pays out 105.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Summary
Costamare beats Golden Ocean Group Limited on 9 of the 14 factors compared between the two stocks.
Golden Ocean Group Limited Company Profile
Golden Ocean Group Limited, formerly Knightsbridge Shipping Limited, is an international dry bulk shipping company. The Company is engaged in the transportation of dry bulk cargoes. It owns and operates a fleet of dry bulk carrier vessels, focusing on the Capesize, Panamax and Supramax markets. Its vessels transport a range of major and minor bulk commodities, including ores, coal, grains and fertilizers. Its fleet includes owned vessels, bareboat vessels, chartered vessels, commercial management vessels and newbuildings. It owns over 40 dry bulk carriers and has contracts for over 20 newbuildings. It also has over 10 vessels chartered-in (of which over eight are chartered in from Ship Finance and over five are chartered in from third parties) and over one vessel chartered-in through a joint venture. Approximately six of the vessels are chartered-out on fixed rate time charters and the other operates in the spot market or fixed on index-linked time charter contracts.
Costamare Company Profile
Costamare Inc. (Costamare) is a holding company. The Company is an international owner of containerships. The Company is engaged in chartering its vessels to various liner companies. The Company provides marine transportation services around the world by chartering its container vessels to liner operators under long, medium and short-term time charters. As of March 10, 2017, the Company had a fleet of 69 containerships with a total capacity of approximately 456,000 TEU, including five newbuilds on order. The Company’s fleet of vessels includes Cosco Guangzhou, Titan, Cosco Yantian, Valor, Valiant and Maersk Kobe. Its subsidiaries include Adele Shipping Co., Bastian Shipping Co., Cadence Shipping Co., Jodie Shipping Co. and Kayley Shipping Co.
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