Frontline (NYSE: FRO) and Blueknight Energy Partners L.P., L.L.C. (NASDAQ:BKEP) are both small-cap transportation companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, valuation, earnings, profitabiliy, institutional ownership and dividends.
Risk & Volatility
Frontline has a beta of 1.97, indicating that its stock price is 97% more volatile than the S&P 500. Comparatively, Blueknight Energy Partners L.P., L.L.C. has a beta of 0.8, indicating that its stock price is 20% less volatile than the S&P 500.
Dividends
Frontline pays an annual dividend of $0.60 per share and has a dividend yield of 10.8%. Blueknight Energy Partners L.P., L.L.C. pays an annual dividend of $0.58 per share and has a dividend yield of 9.9%. Frontline pays out 150.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Blueknight Energy Partners L.P., L.L.C. pays out -446.2% of its earnings in the form of a dividend.
Profitability
This table compares Frontline and Blueknight Energy Partners L.P., L.L.C.’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Frontline | 9.25% | 8.76% | 4.26% |
| Blueknight Energy Partners L.P., L.L.C. | 12.71% | -12.45% | 7.23% |
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Frontline and Blueknight Energy Partners L.P., L.L.C., as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Frontline | 1 | 3 | 1 | 0 | 2.00 |
| Blueknight Energy Partners L.P., L.L.C. | 0 | 0 | 1 | 0 | 3.00 |
Frontline currently has a consensus target price of $6.25, indicating a potential upside of 12.82%. Blueknight Energy Partners L.P., L.L.C. has a consensus target price of $7.20, indicating a potential upside of 23.08%. Given Blueknight Energy Partners L.P., L.L.C.’s stronger consensus rating and higher possible upside, analysts plainly believe Blueknight Energy Partners L.P., L.L.C. is more favorable than Frontline.
Earnings & Valuation
This table compares Frontline and Blueknight Energy Partners L.P., L.L.C.’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Frontline | $702.25 million | 1.34 | $313.91 million | $0.40 | 13.85 |
| Blueknight Energy Partners L.P., L.L.C. | $183.18 million | 1.22 | $65.73 million | ($0.13) | -45.00 |
Frontline has higher revenue and earnings than Blueknight Energy Partners L.P., L.L.C.. Blueknight Energy Partners L.P., L.L.C. is trading at a lower price-to-earnings ratio than Frontline, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
10.9% of Frontline shares are held by institutional investors. Comparatively, 59.7% of Blueknight Energy Partners L.P., L.L.C. shares are held by institutional investors. 48.1% of Frontline shares are held by company insiders. Comparatively, 1.7% of Blueknight Energy Partners L.P., L.L.C. shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Summary
Frontline beats Blueknight Energy Partners L.P., L.L.C. on 8 of the 14 factors compared between the two stocks.
About Frontline
Frontline Ltd. is a shipping company. The Company is engaged in the seaborne transportation of crude oil and oil products. Its tankers segment includes crude oil tankers and product tankers. As of December 31, 2016, the Company’s fleet consisted of 28 vessels owned by the Company (seven very large crude carriers (VLCCs), 10 Suezmax tankers and 11 Aframax/LR2 tankers); 13 vessels that are under capital leases (11 VLCCs and two Suezmax tankers); one VLCC that is recorded as an investment in finance lease; four vessels chartered-in for periods of 12 months, including extension options (two VLCCs and two Suezmax tankers); two VLCCs where cost/revenue is split equally with a third party (of which one is chartered-in by it and one by a third party); three medium range product tankers that are chartered-in on short term time charters with a remaining duration of less than two months, and five vessels that are under commercial management (two Suezmax tankers and three Aframax oil tankers).
About Blueknight Energy Partners L.P., L.L.C.
Blueknight Energy Partners, L.P. is a master limited partnership company. The Company manages its operations through four segments: asphalt terminaling services, crude oil terminaling and storage services, crude oil pipeline services, and crude oil trucking and producer field services. Asphalt terminaling services segment operations generally consist of fee based activities associated with providing storage, terminaling and throughput services for asphalt product and residual fuel oil. Crude oil terminaling and storage segment operations generally consist of fee based activities associated with providing storage, terminaling, and throughput services for crude oil. Crude oil pipeline services segment operations generally consist of fee-based activity associated with transporting crude oil products on pipelines. Crude oil trucking and producer field services segment operations generally consist of fee-based activity associated with transporting crude oil products on trucks.
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