Comparing SFL (NYSE:SFL) and ZIM Integrated Shipping Services (NYSE:ZIM)

SFL (NYSE:SFLGet Rating) and ZIM Integrated Shipping Services (NYSE:ZIMGet Rating) are both transportation companies, but which is the better investment? We will compare the two companies based on the strength of their risk, dividends, earnings, profitability, valuation, analyst recommendations and institutional ownership.

Institutional & Insider Ownership

29.8% of SFL shares are owned by institutional investors. Comparatively, 47.3% of ZIM Integrated Shipping Services shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares SFL and ZIM Integrated Shipping Services’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SFL $513.40 million 3.06 $164.34 million $1.41 8.04
ZIM Integrated Shipping Services $10.73 billion 0.76 $4.64 billion $47.90 1.42

ZIM Integrated Shipping Services has higher revenue and earnings than SFL. ZIM Integrated Shipping Services is trading at a lower price-to-earnings ratio than SFL, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for SFL and ZIM Integrated Shipping Services, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SFL 0 1 1 0 2.50
ZIM Integrated Shipping Services 1 2 2 0 2.20

SFL currently has a consensus price target of $10.00, suggesting a potential downside of 11.82%. ZIM Integrated Shipping Services has a consensus price target of $79.01, suggesting a potential upside of 16.13%. Given ZIM Integrated Shipping Services’ higher probable upside, analysts plainly believe ZIM Integrated Shipping Services is more favorable than SFL.

Dividends

SFL pays an annual dividend of $0.80 per share and has a dividend yield of 7.1%. ZIM Integrated Shipping Services pays an annual dividend of $68.00 per share and has a dividend yield of 100.0%. SFL pays out 56.7% of its earnings in the form of a dividend. ZIM Integrated Shipping Services pays out 142.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. SFL has raised its dividend for 2 consecutive years.

Profitability

This table compares SFL and ZIM Integrated Shipping Services’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SFL 32.31% 14.36% 3.98%
ZIM Integrated Shipping Services 45.36% 167.57% 64.72%

Volatility and Risk

SFL has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500. Comparatively, ZIM Integrated Shipping Services has a beta of 2.42, suggesting that its stock price is 142% more volatile than the S&P 500.

Summary

ZIM Integrated Shipping Services beats SFL on 11 of the 16 factors compared between the two stocks.

About SFL (Get Rating)

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 is also involved in the charter, purchase, and sale of assets. In addition, it operates in various sectors of the maritime, and shipping and offshore industries, including oil, chemical, oil product, container, and car transportation, as well as dry bulk shipments and drilling rigs. As of December 31, 2021, the company owned six crude oil tankers, 15 dry bulk carriers, 35 container vessels, two car carriers, one jack-up drilling rig, one ultra-deepwater drilling unit, two chemical tankers, and four oil product tankers. It primarily operates in Bermuda, Cyprus, Liberia, 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 incorporated in 2003 and is based in Hamilton, Bermuda.

About ZIM Integrated Shipping Services (Get Rating)

ZIM Integrated Shipping Services Ltd., together with its subsidiaries, provides container shipping and related services in Israel and internationally. It provides door-to-door and port-to-port transportation services for various types of customers, including end-users, consolidators, and freight forwarders. The company also offers ZIMonitor, a premium reefer cargo tracking service. As of December 31, 2021, it operated a fleet of 118 vessels, which included 110 container vessels and 8 vehicle transport vessels, of which four vessels were owned by it and 114 vessels are chartered-in; and network of 70 weekly lines. The company was incorporated in 1945 and is headquartered in Haifa, Israel.

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