Performance Shipping (NASDAQ:PSHG – Get Free Report) and Himalaya Shipping (NYSE:HSHP – Get Free Report) are both small-cap transportation companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, risk, analyst recommendations, profitability, valuation and dividends.
Dividends
Performance Shipping pays an annual dividend of $0.10 per share and has a dividend yield of 6.0%. Himalaya Shipping pays an annual dividend of $0.19 per share and has a dividend yield of 3.5%. Performance Shipping pays out 8.9% of its earnings in the form of a dividend. Himalaya Shipping pays out 39.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Performance Shipping is clearly the better dividend stock, given its higher yield and lower payout ratio.
Earnings and Valuation
This table compares Performance Shipping and Himalaya Shipping”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Performance Shipping | $89.61 million | 0.23 | $69.41 million | $1.12 | 1.48 |
| Himalaya Shipping | $123.58 million | 1.75 | $1.51 million | $0.48 | 11.28 |
Institutional & Insider Ownership
19.9% of Performance Shipping shares are owned by institutional investors. Comparatively, 22.3% of Himalaya Shipping shares are owned by institutional investors. 0.4% of Performance Shipping shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Volatility & Risk
Performance Shipping has a beta of -0.39, suggesting that its stock price is 139% less volatile than the S&P 500. Comparatively, Himalaya Shipping has a beta of 2.56, suggesting that its stock price is 156% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of recent recommendations and price targets for Performance Shipping and Himalaya Shipping, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Performance Shipping | 0 | 0 | 1 | 0 | 3.00 |
| Himalaya Shipping | 1 | 0 | 0 | 0 | 1.00 |
Performance Shipping currently has a consensus price target of $6.50, suggesting a potential upside of 291.57%. Given Performance Shipping’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Performance Shipping is more favorable than Himalaya Shipping.
Profitability
This table compares Performance Shipping and Himalaya Shipping’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Performance Shipping | 49.49% | 16.99% | 13.89% |
| Himalaya Shipping | 17.03% | 13.36% | 2.49% |
Summary
Performance Shipping beats Himalaya Shipping on 11 of the 16 factors compared between the two stocks.
About Performance Shipping
Performance Shipping Inc. provides shipping transportation services through its tanker vessels worldwide. As of December 31, 2023, its fleet consisted of seven Aframax tanker vessels with a combined carrying capacity of 735,910 DWT. The company was incorporated in 2010 and is based in Athens, Greece.
About Himalaya Shipping
Himalaya Shipping Ltd. provides dry bulk shipping services worldwide. The company operates a fleet of vessels. It serves major commodity trading, commodity and energy transition, and multi-modal transport companies. Himalaya Shipping Ltd. was incorporated in 2021 and is based in Hamilton, Bermuda.
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