Head to Head Review: Meggitt (OTCMKTS:MEGGF) and BWX Technologies (NYSE:BWXT)

Meggitt (OTCMKTS:MEGGF) and BWX Technologies (NYSE:BWXT) are both industrials companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, profitability and risk.

Insider and Institutional Ownership

54.1% of Meggitt shares are owned by institutional investors. Comparatively, 94.4% of BWX Technologies shares are owned by institutional investors. 0.6% of BWX Technologies shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Meggitt pays an annual dividend of $0.13 per share and has a dividend yield of 1.4%. BWX Technologies pays an annual dividend of $1.08 per share and has a dividend yield of 0.7%. Meggitt pays out 48.8% of its earnings in the form of a dividend. BWX Technologies pays out 28.0% 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 increased its dividend for 2 consecutive years.

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Meggitt	0	0	0	0	0.00
BWX Technologies	1	3	9	2	2.80

BWX Technologies has a consensus target price of $227.20, indicating a potential upside of 44.98%. Given BWX Technologies’ stronger consensus rating and higher possible upside, analysts clearly believe BWX Technologies is more favorable than Meggitt.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Meggitt	N/A	N/A	N/A
BWX Technologies	10.11%	30.83%	9.34%

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Meggitt	N/A	N/A	N/A	$0.26	33.94
BWX Technologies	$3.20 billion	4.49	$328.95 million	$3.86	40.60

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

Summary

BWX Technologies beats Meggitt on 14 of the 15 factors compared between the two stocks.

About Meggitt

Meggitt PLC designs and manufactures components and sub-systems in the United Kingdom, rest of Europe, the United States, and internationally. The company operates in four segments: Airframe Systems, Engine Systems, Energy & Equipment, and Services & Support. It offers ice protection products, radomes, and structures; air data and flight display products; brake control and tyre pressure monitoring systems, and wheels and brakes; engine health and vibration monitors, H2/O2 analyzers, and turbine monitoring and protection products; and aircraft cameras and security systems, and wireless aircraft systems. The company also provides ammunition handling, thermal, weapon scoring, and weapon training systems; energy storage, power conversion and distribution, and power generation systems; ducting systems, engine composites, and flow control valves; and fire protection and controls comprising bleed air leak detection products, cables, electronic control units, fire and overheat detection products, and fire suppression products. In addition, it offers ground fueling, and fuel systems and tanks; motion control actuators, electric motor drives, and electric motors; oxygen and specialty restraint systems; and accelerometers, ceramics, fluid sensors, magnetic and current sensors, position and inertial sensors, pressure sensors, speed sensors, and temperature sensors. Further, the company provides polymer seals; heat exchangers, printed circuit heat exchangers, thermal components, and thermal management systems; and live fire and virtual trainers, as well as aftermarket services. It serves aerospace, defense, and energy and equipment markets. The company was formerly known as Meggitt Holdings Public Limited Company and changed its name to Meggitt PLC in April 1989. Meggitt PLC was incorporated in 1947 and is headquartered in Coventry, the United Kingdom.

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.