Contrasting Air China (OTCMKTS:AIRYY) & Deutsche Lufthansa (OTCMKTS:DLAKY)

Air China (OTCMKTS:AIRYY) and Deutsche Lufthansa (OTCMKTS:DLAKY) are both large-cap transportation companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, risk, valuation, earnings, dividends and profitability.

Analyst Ratings

This is a summary of recent ratings for Air China and Deutsche Lufthansa, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Air China	0	0	0	0	0.00
Deutsche Lufthansa	1	4	0	0	1.80

Earnings & Valuation

This table compares Air China and Deutsche Lufthansa”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Air China	$23.19 billion	0.54	-$32.35 million	$0.02	756.00
Deutsche Lufthansa	$40.67 billion	0.25	$1.49 billion	$1.61	5.22

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

Dividends

Air China pays an annual dividend of $0.09 per share and has a dividend yield of 0.6%. Deutsche Lufthansa pays an annual dividend of $0.22 per share and has a dividend yield of 2.6%. Air China pays out 450.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Deutsche Lufthansa pays out 13.7% of its earnings in the form of a dividend. Deutsche Lufthansa is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Air China has a beta of 0.13, indicating that its share price is 87% less volatile than the S&P 500. Comparatively, Deutsche Lufthansa has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500.

Profitability

This table compares Air China and Deutsche Lufthansa’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Air China	0.47%	2.03%	0.23%
Deutsche Lufthansa	4.76%	17.19%	3.86%

Summary

Deutsche Lufthansa beats Air China on 10 of the 12 factors compared between the two stocks.

About Air China

Air China Limited, together with its subsidiaries, provides air passenger, air cargo, and airline-related services in Mainland China, Hong Kong, Macau, Taiwan, China, and internationally. The company operates in Airline Operations and Other Operations segments. It provides aircraft engineering and airport ground handling services. The company is also involved in the import and export trading activities; and provision of cabin, airline catering, air ticketing, human resources, aircraft overhaul and maintenance, and financial services. Air China Limited was founded in 1988 and is headquartered in Beijing, the People's Republic of China.

About Deutsche Lufthansa

Deutsche Lufthansa AG operates as an aviation company worldwide. It operates in three segments: Passenger Airlines; Logistics; and Maintenance, Repair and Overhaul Services (MRO). The Passenger Airlines segment offers products and services to passengers of Lufthansa Airlines, SWISS, Austrian Airlines, Brussels Airlines, and Eurowings. Its Logistics segment offers airfreight container management, urgent shipments, and customs clearance services; and e-commerce solutions. The MRO segment provides maintenance, repair, and overhaul services for civil commercial aircraft serving original equipment manufacturers, aircraft leasing companies, operators of VIP jets, government, armed forces, and airlines. The company also offers corporate payment and billing services; vocational and professional training for cockpit and cabin crew; and IT solutions. As of December 31, 2023, it had a fleet of 721 aircraft. Deutsche Lufthansa AG was founded in 1926 and is headquartered in Cologne, Germany.