Analyzing Airbus (OTCMKTS:EADSY) and L3Harris Technologies (NYSE:LHX)

L3Harris Technologies (NYSE:LHX) and Airbus (OTCMKTS:EADSY) are both large-cap aerospace companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Analyst Recommendations

This is a summary of current ratings and price targets for L3Harris Technologies and Airbus, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
L3Harris Technologies	0	4	15	1	2.85
Airbus	0	6	4	0	2.40

L3Harris Technologies currently has a consensus target price of $328.57, suggesting a potential downside of 8.39%. Given L3Harris Technologies’ stronger consensus rating and higher probable upside, analysts clearly believe L3Harris Technologies is more favorable than Airbus.

Earnings & Valuation

This table compares L3Harris Technologies and Airbus”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
L3Harris Technologies	$21.87 billion	3.06	$1.61 billion	$8.53	42.05
Airbus	$83.05 billion	1.82	$5.91 billion	$1.89	25.33

Airbus has higher revenue and earnings than L3Harris Technologies. Airbus is trading at a lower price-to-earnings ratio than L3Harris Technologies, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

84.8% of L3Harris Technologies shares are owned by institutional investors. Comparatively, 0.3% of Airbus shares are owned by institutional investors. 0.7% of L3Harris Technologies shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares L3Harris Technologies and Airbus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
L3Harris Technologies	7.35%	10.43%	4.91%
Airbus	7.15%	23.20%	4.10%

Risk and Volatility

L3Harris Technologies has a beta of 0.63, suggesting that its stock price is 37% less volatile than the S&P 500. Comparatively, Airbus has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500.

Dividends

L3Harris Technologies pays an annual dividend of $5.00 per share and has a dividend yield of 1.4%. Airbus pays an annual dividend of $0.41 per share and has a dividend yield of 0.9%. L3Harris Technologies pays out 58.6% of its earnings in the form of a dividend. Airbus pays out 21.7% 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. L3Harris Technologies has increased its dividend for 24 consecutive years. L3Harris Technologies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

L3Harris Technologies beats Airbus on 13 of the 18 factors compared between the two stocks.

About L3Harris Technologies

L3Harris Technologies, Inc. provides mission-critical solutions for government and commercial customers worldwide. The company's Integrated Mission Systems segment provides intelligence, surveillance, and reconnaissance (ISR) systems, passive sensing and targeting, electronic attack, autonomy, power and communications, and networks and sensors, as well as advanced combat systems for air, land, and sea sectors. Its Space and Airborne Systems segment offers space payloads, sensors, and full-mission solutions; classified intelligence and cyber; mission avionics; electronic warfare systems; and mission networks systems for air traffic management operations. The company's Communication Systems segment provides broadband communications; tactical radios, software, satellite terminals, and end-to-end battlefield systems for the U.S. Department of Defense, international, federal, and state agency customers; integrated vision solutions, including helmet-mounted integrated night vision goggles with leading-edge image intensifier tubes and weapon-mounted sights, aiming lasers, and range finders; and public safety radios, and system applications and equipment. Its Aerojet Rocketdyne segment provides propulsion technologies and armament systems for strategic defense, missile defense, hypersonic, and tactical systems; and space propulsion and power systems for national security, and space and exploration missions. The company was formerly known as Harris Corporation and changed its name to L3Harris Technologies, Inc. in June 2019. L3Harris Technologies, Inc. was founded in 1895 and is based in Melbourne, Florida.

About Airbus

Airbus SE, together with its subsidiaries, engages in the design, manufacture, and delivery of aerospace products, services, and solutions worldwide. It operates through three segments: Airbus, Airbus Helicopters, and Airbus Defence and Space. The Airbus segment develops, manufactures, markets, and sells commercial jet passenger aircraft, freighter aircraft, regional turboprop aircraft, and aircraft components, as well as provides aircraft conversion and related services. The Airbus Helicopters segment develops, manufactures, markets, and sells civil and military helicopters; and provides helicopter-related services. The Airbus Defence and Space segment designs, develops, delivers, and supports military air systems and related services. This segment also offers civil and defence space systems for telecommunications, earth observations, navigation, and science and orbital systems; missile and space launcher systems; and services around data processing from platforms, secure communication, and cyber security. The company was formerly known as Airbus Group SE and changed its name to Airbus SE in April 2017. Airbus SE was incorporated in 1998 and is headquartered in Leiden, the Netherlands.