Head-To-Head Analysis: Toro (NASDAQ:TORO) vs. Danaos (NYSE:DAC)

Toro (NASDAQ:TORO) and Danaos (NYSE:DAC) are both small-cap industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.

Insider and Institutional Ownership

1.7% of Toro shares are owned by institutional investors. Comparatively, 19.0% of Danaos shares are owned by institutional investors. 41.0% of Danaos shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Toro and Danaos’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Toro	179.23%	66.54%	31.71%
Danaos	59.19%	19.94%	16.01%

Earnings and Valuation

This table compares Toro and Danaos’ revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Toro	$78.47 million	1.02	$140.64 million	$2.62	1.61
Danaos	$973.58 million	1.46	$576.30 million	$28.96	2.52

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

Analyst Recommendations

This is a breakdown of recent ratings for Toro and Danaos, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Toro	0	0	0	0	N/A
Danaos	0	0	1	0	3.00

Danaos has a consensus target price of $90.00, indicating a potential upside of 23.36%. Given Danaos’ higher probable upside, analysts plainly believe Danaos is more favorable than Toro.

Summary

Danaos beats Toro on 9 of the 12 factors compared between the two stocks.

About Toro

Toro Corp., a shipping company, acquires, owns, charters, and operates oceangoing tanker vessels and provides seaborne transportation services for crude oil LPG, and refined petroleum products worldwide. The company operates in three segments: Aframax/LR2 Tanker, Handysize Tanker, and LPG Carrier. As of December 31, 2023, it operated a fleet of one Handysize tanker vessel; one Aframax/LR2 vessel; and four LPG carrier vessels with an aggregate cargo carrying capacity of 0.1 million deadweight ton. Toro Corp. was incorporated in 2022 and is based in Limassol, Cyprus.

About Danaos

Danaos Corporation, together with its subsidiaries, provides container and drybulk vessels services in Australia, Asia, and Europe. The company offers seaborne transportation services by operating vessels in the containership and drybulk sectors of the shipping industry. As of April 03, 2024, it had a fleet of 68 containerships aggregating 421,293 twenty-foot equivalent units in capacity. The company was formerly known as Danaos Holdings Limited and changed its name to Danaos Corporation in October 2005. Danaos Corporation was founded in 1963 and is based in Piraeus, Greece.