Era Group (NYSE: ERA) and SkyWest (NASDAQ:SKYW) are both small-cap transportation companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitabiliy, risk and dividends.

Valuation and Earnings

This table compares Era Group and SkyWest’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Era Group $239.17 million 0.90 $38.50 million N/A N/A
SkyWest $3.12 billion 0.63 $594.73 million ($3.01) -12.67

SkyWest has higher revenue and earnings than Era Group.

Insider and Institutional Ownership

89.8% of Era Group shares are owned by institutional investors. Comparatively, 90.3% of SkyWest shares are owned by institutional investors. 7.5% of Era Group shares are owned by insiders. Comparatively, 3.5% of SkyWest shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Era Group and SkyWest’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Era Group -4.09% -2.18% -1.06%
SkyWest -4.93% 10.12% 2.92%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Era Group and SkyWest, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Era Group 0 0 0 0 N/A
SkyWest 0 2 2 1 2.80

SkyWest has a consensus target price of $40.50, indicating a potential upside of 6.16%. Given SkyWest’s higher probable upside, analysts clearly believe SkyWest is more favorable than Era Group.

Dividends

SkyWest pays an annual dividend of $0.32 per share and has a dividend yield of 0.8%. Era Group does not pay a dividend. SkyWest pays out -10.6% of its earnings in the form of a dividend.

Risk & Volatility

Era Group has a beta of 0.85, indicating that its stock price is 15% less volatile than the S&P 500. Comparatively, SkyWest has a beta of 1.72, indicating that its stock price is 72% more volatile than the S&P 500.

Summary

SkyWest beats Era Group on 11 of the 14 factors compared between the two stocks.

Era Group Company Profile

Era Group Inc. is engaged in operating helicopters. The Company’s helicopters transport personnel to, from and between offshore oil and gas production platforms, drilling rigs and other installations. The Company also dry-leases helicopters to third-party helicopter operators and foreign affiliates. The primary users of the Company’s helicopter services are international, integrated and independent oil and gas exploration, development and production companies. In addition to serving the oil and gas industry, it provides air medical services; utility services, including support of firefighting, mining, power line and pipeline survey activities, and Alaska flightseeing tours, among other activities. It owns and operates a range of classes of helicopters, such as Heavy helicopters, Medium helicopters and Light helicopters. Heavy helicopters have twin engines and passenger capacity ranging from 16 to 19. Medium helicopters have twin engines and passenger capacity ranging from 11 to 12.

SkyWest Company Profile

SkyWest, Inc., through its subsidiaries, SkyWest Airlines, Inc. (SkyWest Airlines) and ExpressJet Airlines, Inc. (ExpressJet), operates regional airline operations in the United States. The Company’s segments include SkyWest Airlines, ExpressJet and SkyWest Leasing. The SkyWest Airlines segment provides regional jet service to airports primarily located in the Midwestern and Western United States, as well as Mexico and Canada. The ExpressJet segment provides regional jet service to airports primarily located in the Eastern and Midwestern United States, as well as Mexico, Canada and the Caribbean. The SkyWest Leasing segment includes its E175 aircraft ownership business. As of December 31, 2016, the Company offered scheduled passenger service with approximately 3,160 daily departures to destinations in the United States, Canada, Mexico and the Caribbean. The Company’s flights are operated as Delta Connection, United Express, American Eagle or Alaska Airlines.

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