Comparing Airbus (OTCMKTS:EADSY) & Howmet Aerospace (NYSE:HWM)

Howmet Aerospace (NYSE:HWM) and Airbus (OTCMKTS:EADSY) are both large-cap aerospace companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, institutional ownership, risk, valuation, dividends, earnings and analyst recommendations.

Risk & Volatility

Howmet Aerospace has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500. Comparatively, Airbus has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500.

Profitability

This table compares Howmet Aerospace and Airbus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Howmet Aerospace	18.27%	30.41%	13.88%
Airbus	7.15%	23.20%	4.10%

Earnings and Valuation

This table compares Howmet Aerospace and Airbus”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Howmet Aerospace	$8.25 billion	12.54	$1.51 billion	$3.71	69.59
Airbus	$83.05 billion	2.11	$4.58 billion	$1.76	31.59

Airbus has higher revenue and earnings than Howmet Aerospace. Airbus is trading at a lower price-to-earnings ratio than Howmet Aerospace, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Howmet Aerospace and Airbus, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Howmet Aerospace	0	4	17	1	2.86
Airbus	0	5	4	0	2.44

Howmet Aerospace presently has a consensus price target of $252.95, indicating a potential downside of 2.02%. Given Howmet Aerospace’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Howmet Aerospace is more favorable than Airbus.

Institutional & Insider Ownership

90.5% of Howmet Aerospace shares are owned by institutional investors. Comparatively, 0.3% of Airbus shares are owned by institutional investors. 1.0% of Howmet Aerospace shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Howmet Aerospace pays an annual dividend of $0.48 per share and has a dividend yield of 0.2%. Airbus pays an annual dividend of $0.41 per share and has a dividend yield of 0.7%. Howmet Aerospace pays out 12.9% of its earnings in the form of a dividend. Airbus pays out 23.3% 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. Howmet Aerospace has increased its dividend for 5 consecutive years.

Summary

Howmet Aerospace beats Airbus on 15 of the 18 factors compared between the two stocks.

About Howmet Aerospace

Howmet Aerospace Inc. provides advanced engineered solutions for the aerospace and transportation industries in the United States, Japan, France, Germany, the United Kingdom, Mexico, Italy, Canada, Poland, China, and internationally. It operates through four segments: Engine Products, Fastening Systems, Engineered Structures, and Forged Wheels. The Engine Products segment offers airfoils and seamless rolled rings primarily for aircraft engines and industrial gas turbines; and rotating and structural parts. The Fastening Systems segment produces aerospace fastening systems, as well as commercial transportation, industrial, and other fasteners; and latches, bearings, fluid fittings, and installation tools. The Engineered Structures segment provides titanium ingots and mill products, aluminum and nickel forgings, and machined components and assemblies for aerospace and defense applications; and titanium forgings, extrusions, and forming and machining services for airframe, wing, aero-engine, and landing gear components. The Forged Wheels segment offers forged aluminum wheels and related products for heavy-duty trucks and commercial transportation markets. The company was formerly known as Arconic Inc. Howmet Aerospace Inc. was founded in 1888 and is based in Pittsburgh, Pennsylvania.

About Airbus

Airbus SE, together with its subsidiaries, engages in the design, manufacture, and delivery of aerospace products, services, and solutions worldwide. It operates through three segments: Airbus, Airbus Helicopters, and Airbus Defence and Space. The Airbus segment develops, manufactures, markets, and sells commercial jet passenger aircraft, freighter aircraft, regional turboprop aircraft, and aircraft components, as well as provides aircraft conversion and related services. The Airbus Helicopters segment develops, manufactures, markets, and sells civil and military helicopters; and provides helicopter-related services. The Airbus Defence and Space segment designs, develops, delivers, and supports military air systems and related services. This segment also offers civil and defence space systems for telecommunications, earth observations, navigation, and science and orbital systems; missile and space launcher systems; and services around data processing from platforms, secure communication, and cyber security. The company was formerly known as Airbus Group SE and changed its name to Airbus SE in April 2017. Airbus SE was incorporated in 1998 and is headquartered in Leiden, the Netherlands.