Woodward (NASDAQ:WWD) & BWX Technologies (NYSE:BWXT) Critical Analysis

BWX Technologies (NYSE:BWXT) and Woodward (NASDAQ:WWD) are both large-cap aerospace companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, valuation and profitability.

Dividends

BWX Technologies pays an annual dividend of $1.00 per share and has a dividend yield of 0.6%. Woodward pays an annual dividend of $1.12 per share and has a dividend yield of 0.4%. BWX Technologies pays out 30.0% of its earnings in the form of a dividend. Woodward pays out 15.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. BWX Technologies has raised its dividend for 2 consecutive years and Woodward has raised its dividend for 5 consecutive years.

Insider & Institutional Ownership

94.4% of BWX Technologies shares are owned by institutional investors. Comparatively, 81.2% of Woodward shares are owned by institutional investors. 0.5% of BWX Technologies shares are owned by insiders. Comparatively, 0.8% of Woodward shares are owned by 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.

Valuation & Earnings

This table compares BWX Technologies and Woodward”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BWX Technologies	$2.70 billion	6.04	$281.94 million	$3.33	53.62
Woodward	$3.57 billion	5.01	$442.11 million	$7.19	41.51

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for BWX Technologies and Woodward, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BWX Technologies	1	4	7	2	2.71
Woodward	0	4	8	0	2.67

BWX Technologies currently has a consensus price target of $184.83, indicating a potential upside of 3.52%. Woodward has a consensus price target of $286.67, indicating a potential downside of 3.95%. Given BWX Technologies’ stronger consensus rating and higher possible upside, equities research analysts plainly believe BWX Technologies is more favorable than Woodward.

Profitability

This table compares BWX Technologies and Woodward’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BWX Technologies	10.04%	30.70%	10.55%
Woodward	12.39%	17.68%	9.35%

Volatility and Risk

BWX Technologies has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500. Comparatively, Woodward has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500.

About BWX Technologies

BWX Technologies, Inc., together with its subsidiaries, manufactures and sells nuclear components in the United States, Canada, and internationally. It operates through two segments, Government Operations and Commercial Operations. The Government Operations segment designs and manufactures naval nuclear components, reactors, and nuclear fuel; fabrication activities; and supplies proprietary and sole-source valves, manifolds, and fittings to naval and commercial shipping customers. This segment also involved in manufacture of close-tolerance and equipment for nuclear applications; down blend government stockpiles of uranium; receives, stores, characterizes, dissolves, recovers, and purifies uranium-bearing materials; and supplies research reactor fuel elements for colleges, universities, and national laboratories, as well as components for defense applications. The Commercial Operations segment designs and manufactures commercial nuclear steam generators, heat exchangers, pressure vessels, and reactor components; and other auxiliary equipment, including containers for the storage of nuclear fuel and other high-level nuclear waste. This segment also offers nuclear fuel, fuel handling systems, tooling delivery systems, nuclear grade materials, and precisely machined components, and related services for CANDU nuclear power plants; provides in-plant inspection, maintenance, and modification services, as well as non-destructive examination and tooling/repair solutions; and manufactures medical radioisotopes, radiopharmaceuticals, and medical devices. The company was formerly known as The Babcock & Wilcox Company and changed its name to BWX Technologies, Inc. in June 2015. BWX Technologies, Inc. was founded in 1867 and is headquartered in Lynchburg, Virginia.

About Woodward

Woodward, Inc. designs, manufactures, and services control solutions for the aerospace and industrial markets worldwide. The company operates in two segments, Aerospace and Industrial. The Aerospace segment provides fuel pumps, metering units, actuators, air valves, specialty valves, fuel nozzles, and thrust reverser actuation systems for turbine engines and nacelles, and flight deck controls, actuators, servocontrols, motors, and sensors for aircraft. These products are used on commercial and private aircraft and rotorcraft, as well as on military fixed-wing aircraft and rotorcraft, guided weapons, and other defense systems. It also provides aftermarket maintenance, repair and overhaul, and other services to commercial airlines, repair facilities, military depots, third party repair shops, and other end users. This segment sells its products to original equipment manufacturers (OEMs), tier-one suppliers, and contractors, as well as through aftermarket sales of components, such as provisioning spares and replacements. The Industrial segment offers actuators, valves, pumps, fuel injection systems, solenoids, ignition systems, speed controls, electronics and software, and sensors. These products are used on industrial gas turbines, steam turbines, compressors, and reciprocating engines. This segment sells its aftermarket products, and other related services to OEMs through an independent network of distributors, as well as directly to end users. The company was founded in 1870 and is headquartered in Fort Collins, Colorado.