Air China (OTCMKTS:AIRYY) and Air France-KLM (OTCMKTS:AFLYY) Critical Analysis

Air China (OTCMKTS:AIRYY) and Air France-KLM (OTCMKTS:AFLYY) are both transportation companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, earnings, institutional ownership, risk, dividends and valuation.

Analyst Ratings

This is a summary of current ratings for Air China and Air France-KLM, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Air China	0	0	0	0	0.00
Air France-KLM	0	6	2	2	2.60

Risk and Volatility

Air China has a beta of -0.14, meaning that its share price is 114% less volatile than the S&P 500. Comparatively, Air France-KLM has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500.

Profitability

This table compares Air China and Air France-KLM’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Air China	0.19%	0.79%	0.09%
Air France-KLM	5.00%	118.01%	4.38%

Valuation and Earnings

This table compares Air China and Air France-KLM”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Air China	$23.19 billion	0.59	-$32.35 million	$0.02	781.50
Air France-KLM	$28.08 billion	0.10	$1.18 billion	$0.66	1.56

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

Insider & Institutional Ownership

0.9% of Air France-KLM shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Air France-KLM beats Air China on 11 of the 13 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 Air France-KLM

Air France-KLM SA, together with its subsidiaries, provides passenger and cargo transportation services and aeronautical maintenance in Metropolitan France, Benelux, rest of Europe, and internationally. The company operates through three segments: Airframe maintenance, Engine Maintenance, and Component Support. It offers airframe maintenance, electronic, mechanical, pneumatic, hydraulic, and other services. The company was founded in 1919 and is headquartered in Paris, France.