Hexcel Corporation (NYSE: HXL) and AeroVironment (NASDAQ:AVAV) are both aerospace companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, profitability, institutional ownership, valuation and earnings.

Risk and Volatility

Hexcel Corporation has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500. Comparatively, AeroVironment has a beta of 1.29, indicating that its share price is 29% more volatile than the S&P 500.

Earnings and Valuation

This table compares Hexcel Corporation and AeroVironment’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Hexcel Corporation $1.95 billion 2.82 $442.00 million $2.77 22.10
AeroVironment $272.42 million 4.40 $29.48 million $0.84 61.17

Hexcel Corporation has higher revenue and earnings than AeroVironment. Hexcel Corporation is trading at a lower price-to-earnings ratio than AeroVironment, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Hexcel Corporation and AeroVironment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hexcel Corporation 13.13% 18.40% 9.36%
AeroVironment 7.22% 5.40% 4.83%

Dividends

Hexcel Corporation pays an annual dividend of $0.50 per share and has a dividend yield of 0.8%. AeroVironment does not pay a dividend. Hexcel Corporation pays out 18.1% of its earnings in the form of a dividend.

Insider & Institutional Ownership

96.6% of Hexcel Corporation shares are held by institutional investors. Comparatively, 77.6% of AeroVironment shares are held by institutional investors. 2.1% of Hexcel Corporation shares are held by company insiders. Comparatively, 11.0% of AeroVironment shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings for Hexcel Corporation and AeroVironment, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hexcel Corporation 0 6 6 0 2.50
AeroVironment 0 4 0 0 2.00

Hexcel Corporation currently has a consensus target price of $59.20, indicating a potential downside of 3.28%. AeroVironment has a consensus target price of $39.00, indicating a potential downside of 24.09%. Given Hexcel Corporation’s stronger consensus rating and higher probable upside, research analysts plainly believe Hexcel Corporation is more favorable than AeroVironment.

Summary

Hexcel Corporation beats AeroVironment on 11 of the 16 factors compared between the two stocks.

About Hexcel Corporation

Hexcel Corporation is a composites company. The Company develops, manufactures, and markets lightweight, structural materials, including carbon fibers, specialty reinforcements, prepregs and other fiber-reinforced matrix materials, honeycomb, adhesives, engineered honeycomb and structures, for use in Commercial Aerospace, Space and Defense and Industrial markets. It operates in two segments: Composite Materials and Engineered Products. The Composite Materials segment consists of its carbon fiber, specialty reinforcements, resins, prepregs and other fiber-reinforced matrix materials, and honeycomb core product lines. The Engineered Products segment consists of lightweight structures, molded components, engineered core and honeycomb products with added functionality. Its products are used in a range of end applications, such as commercial and military aircraft, space launch vehicles and satellites, wind turbine blades, automotive, and recreational products.

About AeroVironment

AeroVironment, Inc. designs, develops, produces, supports and operates a portfolio of products and services for government agencies, businesses and consumers. The Company operates through two segments: Unmanned Aircraft Systems (UAS), which focuses primarily on the design, development, production, support and operation of UAS and tactical missile systems that provide situational awareness, multi-band communications, force protection and other mission effects, and Efficient Energy Systems (EES), which focuses primarily on the design, development, production, marketing, support and operation of electric energy systems. The Company supplies UAS, tactical missile systems and related services primarily to organizations within the United States Department of Defense (DoD). The Company also supplies charging systems and services for electric vehicles (EVs), and power cycling and test systems to commercial, consumer and government customers.

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