Head to Head Analysis: Ducommun (NYSE:DCO) versus TAT Technologies (NASDAQ:TATT)

Ducommun (NYSE:DCO) and TAT Technologies (NASDAQ:TATT) are both small-cap aerospace companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, dividends and valuation.

Profitability

This table compares Ducommun and TAT Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ducommun	-4.29%	7.70%	4.53%
TAT Technologies	9.08%	11.10%	8.12%

Volatility & Risk

Ducommun has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500. Comparatively, TAT Technologies has a beta of 0.93, meaning that its stock price is 7% less volatile than the S&P 500.

Valuation & Earnings

This table compares Ducommun and TAT Technologies”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ducommun	$786.55 million	2.15	$31.50 million	($2.34)	-48.36
TAT Technologies	$152.12 million	4.20	$11.17 million	$1.33	38.26

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

Institutional and Insider Ownership

92.2% of Ducommun shares are held by institutional investors. Comparatively, 15.1% of TAT Technologies shares are held by institutional investors. 8.9% of Ducommun shares are held by company insiders. Comparatively, 8.8% of TAT Technologies shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Ducommun and TAT Technologies, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ducommun	0	2	5	0	2.71
TAT Technologies	0	1	6	1	3.00

Ducommun currently has a consensus price target of $113.00, suggesting a potential downside of 0.15%. TAT Technologies has a consensus price target of $51.33, suggesting a potential upside of 0.89%. Given TAT Technologies’ stronger consensus rating and higher possible upside, analysts plainly believe TAT Technologies is more favorable than Ducommun.

Summary

TAT Technologies beats Ducommun on 10 of the 15 factors compared between the two stocks.

About Ducommun

Ducommun Incorporated provides engineering and manufacturing services for products and applications used primarily in the aerospace and defense, industrial, medical, and other industries in the United States. The company operates through two segments, Electronic Systems and Structural Systems. The Electronic Systems segment provides cable assemblies and interconnect systems; printed circuit board assemblies; electronic, electromechanical, and mechanical components and assemblies, as well as lightning diversion systems; and radar enclosures, aircraft avionics racks, shipboard communications and control enclosures, printed circuit board assemblies, cable assemblies, wire harnesses, interconnect systems, lightning diversion strips, surge suppressors, conformal shields, and other assemblies. The segment also supplies engineered products, including illuminated pushbutton switches and panels for aviation and test systems; microwave and millimeter switches and filters for radio frequency systems and test instrumentation; and motors and resolvers for motion control. In addition, this segment provides engineering expertise for aerospace system design, development, integration, and testing. The Structural Systems segment designs, engineers, and manufactures contoured aluminum, titanium, and Inconel aero structure components; structural assembly products, such as winglets, engine components, and fuselage structural panels; aerodynamic systems; and metal and composite bonded structures and assemblies comprising aircraft wing spoilers, large fuselage skins, rotor blades on rotary-wing aircraft and components, flight control surfaces, engine components, ammunition handling systems, and magnetic seals. It serves commercial aircraft, military fixed-wing aircraft, military and commercial rotary-wing aircraft, and space programs, as well as industrial, medical, and other end-use markets. The company was founded in 1849 and is headquartered in Santa Ana, California.

About TAT Technologies

TAT Technologies Ltd., together with its subsidiaries, provides solutions and services to the commercial and military aerospace, and ground defense industries in the United States, Israel, and internationally. The company operates through four segments: Original Equipment Manufacturing (OEM) of Heat Transfer Solutions and Aviation Accessories; Maintenance, Repair, and Overhaul (MRO) Services for Heat Transfer Components and OEM of Heat Transfer Solutions; MRO Services for Aviation Components; and Overhaul and Coating of Jet Engine Components. It designs, develops, and manufactures a range of heat transfer solutions, such as pre-cooler and oil/fuel hydraulic heat exchangers used in mechanical and electronic systems in commercial, military, and business aircraft; environmental control and power electronics cooling systems for use in aircraft and ground applications; and a range of other mechanical aircraft accessories and systems, such as pumps, valves, and turbine power units. The company provides MRO services for heat transfer components, as well as for manufacturing heat transfer solutions; and aviation components. In addition, it engages in the operation of a repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers, and the military; and the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes, and afterburner flaps. The company was formerly known as Galagraph Ltd. and changed its name to TAT Technologies Ltd. in May 1992. TAT Technologies Ltd. was founded in 1969 and is headquartered in Netanya, Israel.