Critical Survey: Esterline Technologies Corporation (NYSE:ESL) vs. B/E Aerospace (BEAV)

Esterline Technologies Corporation (NYSE: ESL) and B/E Aerospace (NASDAQ:BEAV) are both aerospace companies, but which is the better investment? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, institutional ownership, valuation, dividends and profitability.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Esterline Technologies Corporation and B/E Aerospace, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Esterline Technologies Corporation 1 4 1 0 2.00
B/E Aerospace 0 8 0 0 2.00

Esterline Technologies Corporation presently has a consensus target price of $92.67, suggesting a potential downside of 0.79%. B/E Aerospace has a consensus target price of $61.75, suggesting a potential downside of 4.22%. Given Esterline Technologies Corporation’s higher probable upside, equities analysts clearly believe Esterline Technologies Corporation is more favorable than B/E Aerospace.

Risk & Volatility

Esterline Technologies Corporation has a beta of 1.49, meaning that its stock price is 49% more volatile than the S&P 500. Comparatively, B/E Aerospace has a beta of 0.86, meaning that its stock price is 14% less volatile than the S&P 500.

Insider & Institutional Ownership

92.2% of Esterline Technologies Corporation shares are owned by institutional investors. Comparatively, 92.0% of B/E Aerospace shares are owned by institutional investors. 1.4% of Esterline Technologies Corporation shares are owned by insiders. Comparatively, 0.5% of B/E Aerospace shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Esterline Technologies Corporation and B/E Aerospace’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Esterline Technologies Corporation 6.65% 9.18% 5.06%
B/E Aerospace 8.25% 94.11% 6.79%

Valuation & Earnings

This table compares Esterline Technologies Corporation and B/E Aerospace’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Esterline Technologies Corporation $2.01 billion 1.39 $312.43 million $4.48 20.85
B/E Aerospace N/A N/A N/A $3.08 20.93

Esterline Technologies Corporation has higher revenue and earnings than B/E Aerospace. Esterline Technologies Corporation is trading at a lower price-to-earnings ratio than B/E Aerospace, indicating that it is currently the more affordable of the two stocks.

Dividends

B/E Aerospace pays an annual dividend of $0.84 per share and has a dividend yield of 1.3%. Esterline Technologies Corporation does not pay a dividend. B/E Aerospace pays out 27.3% of its earnings in the form of a dividend.

Summary

Esterline Technologies Corporation beats B/E Aerospace on 8 of the 12 factors compared between the two stocks.

Esterline Technologies Corporation Company Profile

Esterline Technologies Corporation is a specialized manufacturing company. The Company designs, manufactures and markets engineered products and systems for application within the industries it serves. The Company operates through three segments: Avionics & Controls, Sensors & Systems, and Advanced Materials. The Company serves aerospace and defense customers. The Company’s Avionics & Controls business segment includes avionics systems, control and communication systems, and interface technologies capabilities. The Company’s Sensors & Systems business segment includes power systems, connection technologies and advanced sensors capabilities. The Company’s Advanced Materials business segment includes engineered materials and defense technologies capabilities. The Company designs and manufactures ruggedized military personal communication equipment, primarily headsets, handsets and field communications.

B/E Aerospace Company Profile

B/E Aerospace, Inc. is a manufacturer of cabin interior products for commercial aircraft and business jets. The Company sells its products and provides services directly to airlines and aerospace manufacturer. It operates through two segments. The Company manufactures aircraft seats, offering a selection of first class, business class, tourist class and regional aircraft seats. It manufactures and sells seats, which include the seat frame, cushions, armrests, tray table and a range of optional features, such as adjustable lumbar supports, electrical actuation systems, footrests, reading lights, head/neck supports and other comfort amenities. The business jet segment’s products include a range of business jet seating and sofa products, including electric fully berthing lie-flat seats, air valves and oxygen delivery systems as well as sidewalls, bulkheads, credenzas, closets, galley structures, lavatories, wastewater systems, de-icing systems, cabin management systems and tables.

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