Exelis (NYSE: XLS) and Raytheon (NYSE:RTN) are both industrials companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, risk, profitability and institutional ownership.
Insider and Institutional Ownership
73.5% of Raytheon shares are held by institutional investors. 0.2% of Raytheon shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
This table compares Exelis and Raytheon’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings & Valuation
This table compares Exelis and Raytheon’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Raytheon||$25.35 billion||2.38||$2.02 billion||$7.53||27.76|
Raytheon has higher revenue and earnings than Exelis. Exelis is trading at a lower price-to-earnings ratio than Raytheon, indicating that it is currently the more affordable of the two stocks.
Raytheon pays an annual dividend of $3.19 per share and has a dividend yield of 1.5%. Exelis does not pay a dividend. Raytheon pays out 42.4% of its earnings in the form of a dividend. Raytheon has increased its dividend for 13 consecutive years.
This is a breakdown of recent ratings and recommmendations for Exelis and Raytheon, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Raytheon has a consensus price target of $215.73, indicating a potential upside of 3.19%. Given Raytheon’s higher possible upside, analysts plainly believe Raytheon is more favorable than Exelis.
Raytheon beats Exelis on 12 of the 13 factors compared between the two stocks.
Exelis Inc. (Exelis) is a diversified aerospace, defense, information and services company. The Company delivers mission-critical solutions to military, government and commercial customers in the United States and globally. It operates in two segments: Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) Electronics and Systems, and Information and Technical Services. Its C4ISR Electronics and Systems segment provides engineered systems and solutions, including: ISR systems; integrated electronic warfare systems; radar and sonar systems; electronic attack and release systems; communications solutions; space systems, and composite aerostructures. The Company’s Information and Technical Services segment provides a range of service solutions: systems integration; network design and development; air traffic management; cyber; intelligence; advanced engineering, and space launch and range-support.
Raytheon Company is a technology company, which specializes in defense and other government markets. The Company develops integrated products, services and solutions in various markets, including sensing; effects; command, control, communications, computers, cyber and intelligence; mission support, and cybersecurity. The Company operates through five segments: Integrated Defense Systems (IDS); Intelligence, Information and Services (IIS); Missile Systems (MS); Space and Airborne Systems (SAS), and Forcepoint. The IDS segment develops and produces sensors and mission systems. The IIS segment provides a range of technical and professional services to intelligence, defense, federal and commercial customers. The MS segment is a developer, integrator and producer of missile and combat systems. The SAS segment is engaged in the design, development and manufacture of integrated sensor and communication systems for missions. The Forcepoint segment develops cybersecurity products.
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