Reviewing Toro (NASDAQ:TORO) and Euroseas (NASDAQ:ESEA)

Euroseas (NASDAQ:ESEA) and Toro (NASDAQ:TORO) are both small-cap transportation companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, risk, institutional ownership and dividends.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Euroseas	54.21%	34.73%	20.86%
Toro	176.49%	17.16%	10.30%

Valuation & Earnings

This table compares Euroseas and Toro”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Euroseas	$208.65 million	1.19	$114.55 million	$16.22	2.18
Toro	$80.63 million	0.68	$140.64 million	$1.06	2.72

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

Insider and Institutional Ownership

6.3% of Euroseas shares are owned by institutional investors. Comparatively, 1.7% of Toro shares are owned by institutional investors. 55.9% of Euroseas shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and price targets for Euroseas and Toro, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Euroseas	0	0	1	1	3.50
Toro	0	0	0	0	0.00

Euroseas currently has a consensus target price of $56.50, indicating a potential upside of 60.06%. Given Euroseas’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Euroseas is more favorable than Toro.

Volatility & Risk

Euroseas has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500. Comparatively, Toro has a beta of 1.55, meaning that its share price is 55% more volatile than the S&P 500.

Summary

Euroseas beats Toro on 11 of the 15 factors compared between the two stocks.

About Euroseas

Euroseas Ltd. provides ocean-going transportation services worldwide. The company owns and operates containerships that transport dry and refrigerated containerized cargoes, including manufactured products and perishables. As of March 31, 2024, it had a fleet of 20 containerships with a cargo carrying capacity of approximately 777,749 dwt. The company was incorporated in 2005 and is based in Marousi, Greece.

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.