Contrasting Heico (NYSE:HEI.A) and AeroVironment (NASDAQ:AVAV)

AeroVironment (NASDAQ:AVAV) and Heico (NYSE:HEI.A) are both large-cap aerospace companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, analyst recommendations, earnings and risk.

Institutional and Insider Ownership

86.4% of AeroVironment shares are owned by institutional investors. Comparatively, 59.0% of Heico shares are owned by institutional investors. 0.8% of AeroVironment shares are owned by insiders. Comparatively, 9.8% of Heico shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

AeroVironment has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500. Comparatively, Heico has a beta of 1.08, meaning that its stock price is 8% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
AeroVironment	-4.14%	4.67%	3.73%
Heico	14.96%	16.29%	8.00%

Analyst Ratings

This is a summary of recent ratings and recommmendations for AeroVironment and Heico, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AeroVironment	1	1	19	2	2.96
Heico	0	0	0	0	0.00

AeroVironment currently has a consensus target price of $373.50, suggesting a potential upside of 52.29%. Given AeroVironment’s stronger consensus rating and higher probable upside, research analysts plainly believe AeroVironment is more favorable than Heico.

Earnings & Valuation

This table compares AeroVironment and Heico”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AeroVironment	$1.09 billion	11.28	$43.62 million	($0.64)	-383.20
Heico	$3.86 billion	8.69	$514.11 million	$4.57	52.69

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

Summary

Heico beats AeroVironment on 8 of the 15 factors compared between the two stocks.

About AeroVironment

AeroVironment, Inc. designs, develops, produces, delivers, and supports a portfolio of robotic systems and related services for government agencies and businesses in the United States and internationally. It operates through Small Unmanned Aircraft Systems (SUAS), Tactical Missile System (TMS), Medium Unmanned Aircraft Systems (MUAS), and High Altitude Pseudo-Satellite Systems (HAPS) segments. The company supplies UAS, TMS, unmanned ground vehicle, and related services primarily to organizations within the U.S. Department of Defense, other federal agencies, and to international allied governments. It also designs, engineers, tools, and manufactures unmanned aerial and aircraft systems, including airborne platforms, payloads and payload integration, ground control systems, and ground support equipment and other items and services related to unmanned aircraft systems. In addition, the company offers small UAS products, including training, spare parts, product repair, product replacement, and the customer contracted operation. Further, it develops high-altitude pseudo-satellite UAS systems. AeroVironment, Inc. was incorporated in 1971 and is headquartered in Arlington, Virginia.

About Heico

HEICO Corporation, through its subsidiaries, designs, manufactures, and sells aerospace, defense, and electronic related products and services in the United States and internationally. The company's Flight Support Group segment provides jet engine and aircraft component replacement parts; thermal insulation blankets and parts; renewable/reusable insulation systems; and specialty components. This segment also distributes hydraulic, pneumatic, structural, interconnect, mechanical, and electro-mechanical components for the commercial, regional, and general aviation markets; and offers repair and overhaul services for jet engine and aircraft component parts, avionics, instruments, composites, and flight surfaces of commercial aircraft, as well as for avionics and navigation systems, subcomponents, and other instruments utilized on military aircraft. Its Electronic Technologies Group segment provides electro-optical infrared simulation and test equipment; electro-optical laser products; electro-optical, microwave, and other power equipment; electromagnetic and radio interference shielding and suppression filters; high-speed interface products; high voltage interconnection devices; high voltage advanced power electronics; power conversion products; and underwater locator beacons and emergency locator transmission beacons. This segment also offers traveling wave tube amplifiers and microwave power modules; three-dimensional microelectronic and stacked memory products; harsh environment connectivity products and custom molded cable assemblies; radio frequency and microwave amplifiers, transmitters, and receivers; communications and electronic intercept receivers and tuners; self-sealing auxiliary fuel systems; active antenna systems; and nuclear radiation detectors. The company serves customers primarily in the aviation, defense, space, medical, telecommunications, and electronics industries. HEICO Corporation was founded in 1957 and is headquartered in Hollywood, Florida.