TransDigm Group (NYSE:TDG) and The Boeing (NYSE:BA) are both large-cap aerospace companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, dividends, risk, institutional ownership, earnings, analyst recommendations and profitability.
Profitability
This table compares TransDigm Group and The Boeing's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| TransDigm Group | 10.07% | -18.70% | 4.36% |
| The Boeing | -7.34% | N/A | -3.85% |
Institutional and Insider Ownership
97.2% of TransDigm Group shares are held by institutional investors. Comparatively, 51.4% of The Boeing shares are held by institutional investors. 8.2% of TransDigm Group shares are held by insiders. Comparatively, 0.2% of The Boeing shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Analyst Ratings
This is a summary of recent ratings for TransDigm Group and The Boeing, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| TransDigm Group | 0 | 4 | 10 | 0 | 2.71 |
| The Boeing | 3 | 7 | 15 | 0 | 2.48 |
TransDigm Group currently has a consensus price target of $664.7857, indicating a potential upside of 13.33%. The Boeing has a consensus price target of $247.4545, indicating a potential upside of 11.15%. Given TransDigm Group's stronger consensus rating and higher probable upside, analysts plainly believe TransDigm Group is more favorable than The Boeing.
Valuation and Earnings
This table compares TransDigm Group and The Boeing's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| TransDigm Group | $5.10 billion | 6.29 | $699 million | $14.04 | 41.78 |
| The Boeing | $76.56 billion | 1.70 | $-636,000,000.00 | ($3.47) | -64.16 |
TransDigm Group has higher earnings, but lower revenue than The Boeing. The Boeing is trading at a lower price-to-earnings ratio than TransDigm Group, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
TransDigm Group has a beta of 1.59, indicating that its stock price is 59% more volatile than the S&P 500. Comparatively, The Boeing has a beta of 1.65, indicating that its stock price is 65% more volatile than the S&P 500.
Summary
TransDigm Group beats The Boeing on 10 of the 14 factors compared between the two stocks.
