Deutsche Lufthansa (OTCMKTS:DLAKY) and American Airlines Group (NASDAQ:AAL) are both transportation companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, profitability and dividends.
Valuation & Earnings
This table compares Deutsche Lufthansa and American Airlines Group's top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Deutsche Lufthansa | $40.80 billion | 0.19 | $1.36 billion | $2.86 | 4.51 |
| American Airlines Group | $45.77 billion | 0.31 | $1.69 billion | $4.90 | 4.50 |
American Airlines Group has higher revenue and earnings than Deutsche Lufthansa. American Airlines Group is trading at a lower price-to-earnings ratio than Deutsche Lufthansa, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Deutsche Lufthansa and American Airlines Group's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Deutsche Lufthansa | -27.74% | -60.12% | -9.73% |
| American Airlines Group | -25.56% | N/A | -11.06% |
Insider & Institutional Ownership
0.1% of Deutsche Lufthansa shares are held by institutional investors. Comparatively, 44.4% of American Airlines Group shares are held by institutional investors. 1.0% of American Airlines Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Analyst Ratings
This is a summary of recent recommendations for Deutsche Lufthansa and American Airlines Group, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Deutsche Lufthansa | 10 | 2 | 1 | 0 | 1.31 |
| American Airlines Group | 8 | 7 | 1 | 0 | 1.56 |
American Airlines Group has a consensus price target of $15.5714, indicating a potential downside of 29.32%. Given American Airlines Group's stronger consensus rating and higher probable upside, analysts clearly believe American Airlines Group is more favorable than Deutsche Lufthansa.
Volatility & Risk
Deutsche Lufthansa has a beta of 1.44, suggesting that its share price is 44% more volatile than the S&P 500. Comparatively, American Airlines Group has a beta of 1.82, suggesting that its share price is 82% more volatile than the S&P 500.
Summary
American Airlines Group beats Deutsche Lufthansa on 11 of the 13 factors compared between the two stocks.
