Contrasting Mayville Engineering (NYSE:MEC) and KBR (NYSE:KBR)

KBR (NYSE:KBR) and Mayville Engineering (NYSE:MEC) are both construction companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, profitability and institutional ownership.

Valuation and Earnings

This table compares KBR and Mayville Engineering”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
KBR	$7.74 billion	0.70	$375.00 million	$2.91	14.71
Mayville Engineering	$533.52 million	0.67	$25.97 million	$0.58	30.22

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

Profitability

This table compares KBR and Mayville Engineering’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
KBR	4.71%	35.14%	7.63%
Mayville Engineering	2.29%	5.88%	3.06%

Risk and Volatility

KBR has a beta of 0.54, indicating that its stock price is 46% less volatile than the S&P 500. Comparatively, Mayville Engineering has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500.

Insider and Institutional Ownership

97.0% of KBR shares are held by institutional investors. Comparatively, 45.4% of Mayville Engineering shares are held by institutional investors. 1.1% of KBR shares are held by company insiders. Comparatively, 7.2% of Mayville Engineering shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations for KBR and Mayville Engineering, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
KBR	0	7	5	0	2.42
Mayville Engineering	0	1	4	1	3.00

KBR currently has a consensus price target of $59.09, indicating a potential upside of 38.03%. Mayville Engineering has a consensus price target of $21.50, indicating a potential upside of 22.65%. Given KBR’s higher possible upside, equities analysts plainly believe KBR is more favorable than Mayville Engineering.

Summary

KBR beats Mayville Engineering on 10 of the 15 factors compared between the two stocks.

About KBR

KBR, Inc. provides scientific, technology, and engineering solutions to governments and commercial customers worldwide. It operates through Government Solutions and Sustainable Technology Solutions segments. The Government Solutions segment offers life-cycle support solutions to defense, intelligence, space, aviation, and other programs and missions for military and other government agencies in the United States, the United Kingdom, and Australia. Its services cover research and development, advanced prototyping, acquisition support, systems engineering, cyber analytics, space domain awareness, test and evaluation, systems integration and program management, global supply chain management, and operations readiness and support, as well as command, control, communications, computers, intelligence, surveillance, and reconnaissance services. This segment also provides various professional advisory services to the defense, renewable energy, and critical infrastructure sectors. The Sustainable Technology Solutions segment operates portfolio of various proprietary process technologies for ammonia/syngas, chemical/petrochemicals, clean refining, and circular process/circular economy solutions. This segment also provides synergistic services, including advisory and consulting focused on broad-based energy transition and net-zero carbon emission solutions; high-end engineering, design and program management centered around decarbonization, energy efficiency, environmental impact and asset optimization; and digitally-enabled operating and monitoring solutions. KBR, Inc. was founded in 1901 and is headquartered in Houston, Texas.

About Mayville Engineering

Mayville Engineering Company, Inc., together with its subsidiaries, engages in the production, design, prototyping and tooling, fabrication, aluminum extrusion, coating, and assembling of aftermarket components in the United States. It also supplies engineered components to original equipment manufacturers. The company serves heavy and medium duty commercial vehicles, construction and access equipment, powersports, agriculture, military, and other end markets. Mayville Engineering Company, Inc. was founded in 1945 and is headquartered in Milwaukee, Wisconsin.