Analyzing Rocket Lab (NASDAQ:RKLB) & Rolls-Royce Holdings PLC (OTCMKTS:RYCEY)

Rocket Lab (NASDAQ:RKLB) and Rolls-Royce Holdings PLC (OTCMKTS:RYCEY) are both large-cap aerospace companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, institutional ownership, valuation, analyst recommendations, dividends, earnings and risk.

Institutional & Insider Ownership

71.8% of Rocket Lab shares are held by institutional investors. Comparatively, 0.1% of Rolls-Royce Holdings PLC shares are held by institutional investors. 11.9% of Rocket Lab shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Rocket Lab and Rolls-Royce Holdings PLC”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rocket Lab	$436.21 million	50.74	-$190.18 million	($0.45)	-102.60
Rolls-Royce Holdings PLC	$24.16 billion	5.24	$3.22 billion	N/A	N/A

Rolls-Royce Holdings PLC has higher revenue and earnings than Rocket Lab.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Rocket Lab and Rolls-Royce Holdings PLC, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rocket Lab	0	5	7	1	2.69
Rolls-Royce Holdings PLC	0	2	0	1	2.67

Rocket Lab currently has a consensus price target of $42.27, indicating a potential downside of 8.44%. Given Rocket Lab’s stronger consensus rating and higher probable upside, equities analysts clearly believe Rocket Lab is more favorable than Rolls-Royce Holdings PLC.

Risk and Volatility

Rocket Lab has a beta of 2.17, suggesting that its stock price is 117% more volatile than the S&P 500. Comparatively, Rolls-Royce Holdings PLC has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.

Profitability

This table compares Rocket Lab and Rolls-Royce Holdings PLC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rocket Lab	-45.87%	-48.14%	-17.98%
Rolls-Royce Holdings PLC	N/A	N/A	N/A

Summary

Rocket Lab beats Rolls-Royce Holdings PLC on 7 of the 12 factors compared between the two stocks.

About Rocket Lab

Rocket Lab USA, Inc., a space company, provides launch services and space systems solutions for the space and defense industries. The company provides launch services, spacecraft design services, spacecraft components, spacecraft manufacturing, and other spacecraft and on-orbit management solutions; and constellation management services, as well as designs and manufactures small and medium-class rockets. It also designs, manufactures, and sells Electron, a reusable orbital-class small rocket; and the Photon satellite platforms, as well as developing the Neutron 8-ton payload class launch vehicle; conducts remote launch activities; and designs and manufactures a range of components and subsystems for the Photon family of spacecraft and broader merchant spacecraft components. The company serves commercial, aerospace prime contractors, and government customers. Rocket Lab USA, Inc. was founded in 2006 and is headquartered in Long Beach, California.

About Rolls-Royce Holdings PLC

Rolls-Royce Holdings plc develops and delivers complex power and propulsion solutions for air, sea, and land in the United Kingdom and internationally. The company operates through four segments: Civil Aerospace, Defence, Power Systems, and New Markets. The Civil Aerospace segment develops, manufactures, markets, and sells aero engines for large commercial aircraft, regional jet, and business aviation markets, as well as provides aftermarket services. The Defence segment is involved in the development, manufacture, marketing, and sale of military aero engines, naval engines, and submarine nuclear power plants, as well as offers aftermarket services. The Power Systems segment engages in the development, manufacture, marketing, and sale of integrated solutions for onsite power and propulsion under the mtu brand name. The New Markets segment develops, manufactures, and sells small modular reactor and new electrical power solutions. Rolls-Royce Holdings plc was founded in 1884 and is headquartered in London, the United Kingdom.