Contrasting Park Aerospace (NYSE:PKE) and Lockheed Martin (NYSE:LMT)

Lockheed Martin (NYSE:LMT) and Park Aerospace (NYSE:PKE) are both industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, dividends, earnings, institutional ownership and analyst recommendations.

Insider & Institutional Ownership

74.2% of Lockheed Martin shares are held by institutional investors. Comparatively, 77.8% of Park Aerospace shares are held by institutional investors. 0.1% of Lockheed Martin shares are held by insiders. Comparatively, 7.1% of Park Aerospace shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Lockheed Martin and Park Aerospace”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lockheed Martin	$75.05 billion	1.64	$5.02 billion	$27.13	19.66
Park Aerospace	$73.30 million	9.18	$11.27 million	$0.63	49.11

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

Dividends

Lockheed Martin pays an annual dividend of $13.80 per share and has a dividend yield of 2.6%. Park Aerospace pays an annual dividend of $0.50 per share and has a dividend yield of 1.6%. Lockheed Martin pays out 50.9% of its earnings in the form of a dividend. Park Aerospace pays out 79.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Lockheed Martin has increased its dividend for 22 consecutive years. Lockheed Martin is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings for Lockheed Martin and Park Aerospace, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lockheed Martin	1	9	8	1	2.47
Park Aerospace	0	0	4	0	3.00

Lockheed Martin presently has a consensus target price of $637.56, suggesting a potential upside of 19.56%. Park Aerospace has a consensus target price of $42.50, suggesting a potential upside of 37.36%. Given Park Aerospace’s stronger consensus rating and higher possible upside, analysts plainly believe Park Aerospace is more favorable than Lockheed Martin.

Profitability

This table compares Lockheed Martin and Park Aerospace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lockheed Martin	8.16%	91.42%	11.02%
Park Aerospace	16.70%	10.75%	9.77%

Risk & Volatility

Lockheed Martin has a beta of 0.1, suggesting that its share price is 90% less volatile than the S&P 500. Comparatively, Park Aerospace has a beta of 0.4, suggesting that its share price is 60% less volatile than the S&P 500.

Summary

Lockheed Martin beats Park Aerospace on 10 of the 18 factors compared between the two stocks.

About Lockheed Martin

Lockheed Martin Corporation, a security and aerospace company, engages in the research, design, development, manufacture, integration, and sustainment of technology systems, products, and services worldwide. The company operates through Aeronautics, Missiles and Fire Control, Rotary and Mission Systems, and Space segments. The Aeronautics segment offers combat and air mobility aircraft, unmanned air vehicles, and related technologies. The Missiles and Fire Control segment provides air and missile defense systems; tactical missiles and air-to-ground precision strike weapon systems; logistics; fire control systems; mission operations support, readiness, engineering support, and integration services; manned and unmanned ground vehicles; and energy management solutions. The Rotary and Mission Systems segment offers military and commercial helicopters, surface ships, sea and land-based missile defense systems, radar systems, sea and air-based mission and combat systems, command and control mission solutions, cyber solutions, and simulation and training solutions. The Space segment offers satellites; space transportation systems; strategic, advanced strike, and defensive systems; and classified systems and services in support of national security systems. This segment also provides network-enabled situational awareness and integrates space and ground global systems to help its customers gather, analyze, and securely distribute critical intelligence data. It serves primarily serves the U.S. government, as well as foreign military sales contracted through the U.S. government. The company was founded in 1912 and is based in Bethesda, Maryland.

About Park Aerospace

Park Aerospace Corp., an aerospace company, develops and manufactures solution and hot-melt advanced composite materials used to produce composite structures for the aerospace market in North America, Asia, and Europe. It offers advanced composite materials, including film adhesives and lightning strike protection materials that are used to produce primary and secondary structures for jet engines, large and regional transport aircrafts, military aircrafts, unmanned aerial vehicles, business jets, general aviation aircrafts, and rotary wing aircrafts. The company also provides specialty ablative materials for rocket motors and nozzles; and specially designed materials for radome applications. In addition, it designs and fabricates composite parts, structures and assemblies, and low volume tooling for the aerospace industry. The company was formerly known as Park Electrochemical Corp. and changed its name to Park Aerospace Corp. in July 2019. Park Aerospace Corp. was incorporated in 1954 and is based in Westbury, New York.