Financial Analysis: Odyssey Marine Exploration (OMEX) versus Vectrus (VEC)

Odyssey Marine Exploration (NASDAQ: OMEX) and Vectrus (NYSE:VEC) are both small-cap transportation companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, analyst recommendations and profitability.

Analyst Ratings

This is a summary of recent recommendations for Odyssey Marine Exploration and Vectrus, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Odyssey Marine Exploration	0	0	0	0	N/A
Vectrus	0	1	1	0	2.50

Vectrus has a consensus price target of $22.00, indicating a potential downside of 19.80%. Given Vectrus’ higher probable upside, analysts clearly believe Vectrus is more favorable than Odyssey Marine Exploration.

Insider & Institutional Ownership

7.8% of Odyssey Marine Exploration shares are held by institutional investors. Comparatively, 84.3% of Vectrus shares are held by institutional investors. 8.2% of Odyssey Marine Exploration shares are held by insiders. Comparatively, 3.9% of Vectrus shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Odyssey Marine Exploration and Vectrus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Odyssey Marine Exploration	N/A	N/A	-200.42%
Vectrus	2.06%	18.96%	5.04%

Risk and Volatility

Odyssey Marine Exploration has a beta of 3.13, indicating that its stock price is 213% more volatile than the S&P 500. Comparatively, Vectrus has a beta of 2.17, indicating that its stock price is 117% more volatile than the S&P 500.

Valuation and Earnings

This table compares Odyssey Marine Exploration and Vectrus’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
Odyssey Marine Exploration	$4.12 million	8.31	-$8.98 million	($1.11)	-3.68
Vectrus	$1.12 billion	0.27	$45.00 million	$1.90	14.44

Vectrus has higher revenue and earnings than Odyssey Marine Exploration. Odyssey Marine Exploration is trading at a lower price-to-earnings ratio than Vectrus, indicating that it is currently the more affordable of the two stocks.

Summary

Vectrus beats Odyssey Marine Exploration on 9 of the 12 factors compared between the two stocks.

Odyssey Marine Exploration Company Profile

Odyssey Marine Exploration, Inc. (Odyssey) is a deep-ocean exploration company. The Company’s techniques are applied to mineral exploration, shipwreck cargo recovery, and other marine survey and exploration charter services. The Company is engaged in discovering shipwreck sites in the deep ocean and conducting archaeological excavations with remotely operated vehicles (ROVs). Its shipwreck discoveries include the SS Republic, HMS Victory, Black Swan, La Marquise de Tourny and other unidentified shipwrecks. The Company offers exploration services, including geophysical and geotechnical assessments of seabed mineral deposits to companies, including its subsidiaries and companies, in which it holds an equity position, as a resource development partner. The Company evaluates or explores various types of seabed mineral deposits, such as phosphorites, polymetallic nodules and seafloor massive sulfides. Odyssey offers its marine exploration services to third-party companies.

Vectrus Company Profile

Vectrus, Inc. is a provider of services to the United States Government across the world. The Company offers services, including infrastructure asset management, logistics and supply chain management, and information technology and network communication. Its infrastructure asset management services support the United States Army, Air Force and Navy, and include infrastructure services, security, warehouse management and distribution, ammunition management, civil engineering, air base maintenance and operations, communications, emergency services, transportation, and life support activities at various global military installations. Its logistics and supply chain management services support and maintain the vehicle and equipment stocks of the United States Army and Marine Corps. Its information technology and network communication services consist of sustainment of communications systems, network security, systems installation and life cycle management of information technology systems.