Financial Analysis: Orbital ATK (OA) versus The Competition

Orbital ATK (NYSE: OA) is one of 43 public companies in the “Aerospace & Defense” industry, but how does it weigh in compared to its rivals? We will compare Orbital ATK to similar businesses based on the strength of its earnings, institutional ownership, analyst recommendations, profitability, valuation, dividends and risk.

Volatility and Risk

Orbital ATK has a beta of 0.43, suggesting that its stock price is 57% less volatile than the S&P 500. Comparatively, Orbital ATK’s rivals have a beta of 1.10, suggesting that their average stock price is 10% more volatile than the S&P 500.

Profitability

This table compares Orbital ATK and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Orbital ATK 6.62% 17.32% 6.08%
Orbital ATK Competitors -6.60% 22.34% 3.38%

Analyst Recommendations

This is a summary of current ratings for Orbital ATK and its rivals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Orbital ATK 0 8 3 0 2.27
Orbital ATK Competitors 482 2202 2406 86 2.40

Orbital ATK presently has a consensus price target of $118.81, indicating a potential downside of 10.18%. As a group, “Aerospace & Defense” companies have a potential upside of 14.10%. Given Orbital ATK’s rivals stronger consensus rating and higher possible upside, analysts clearly believe Orbital ATK has less favorable growth aspects than its rivals.

Valuation and Earnings

This table compares Orbital ATK and its rivals revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Orbital ATK $4.46 billion $293.00 million 24.41
Orbital ATK Competitors $8.89 billion $721.62 million 195.26

Orbital ATK’s rivals have higher revenue and earnings than Orbital ATK. Orbital ATK is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Insider and Institutional Ownership

85.7% of Orbital ATK shares are owned by institutional investors. Comparatively, 73.3% of shares of all “Aerospace & Defense” companies are owned by institutional investors. 1.2% of Orbital ATK shares are owned by insiders. Comparatively, 6.5% of shares of all “Aerospace & Defense” companies are owned 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.

Dividends

Orbital ATK pays an annual dividend of $1.28 per share and has a dividend yield of 1.0%. Orbital ATK pays out 23.6% of its earnings in the form of a dividend. As a group, “Aerospace & Defense” companies pay a dividend yield of 1.4% and pay out 35.9% of their earnings in the form of a dividend.

Summary

Orbital ATK rivals beat Orbital ATK on 11 of the 15 factors compared.

Orbital ATK Company Profile

Orbital ATK, Inc. is an aerospace and defense systems company and supplier of related products to the United States Government, allied nations, prime contractors and other customers. The Company’s segments include Flight Systems Group, Defense Systems Group, Space Systems Group and Corporate. Its products include launch vehicles and related propulsion systems; satellites and associated components and services; tactical missiles, subsystems and defense electronics, and precision weapons, armament systems and ammunition. The Flight Systems Group segment consists of Launch Vehicles Division, Propulsion Systems Division and Aerospace Structures Division. The Defense Systems Group segment consists of Armament Systems Division, Defense Electronic Division, Missile Products Division and Small Caliber Systems Division. The Space Systems Group consists of Commercial Satellites Division, Government Satellites Division, Space Components Division and Technical Services Division.

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