Moog (NYSE:MOG.B) and TAT Technologies (NASDAQ:TATT) Critical Review

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

Institutional and Insider Ownership

8.1% of Moog shares are held by institutional investors. Comparatively, 15.1% of TAT Technologies shares are held by institutional investors. 2.4% of Moog 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 hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and price targets for Moog and TAT Technologies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Moog	0	0	0	0	0.00
TAT Technologies	0	1	6	1	3.00

TAT Technologies has a consensus target price of $53.17, indicating a potential downside of 7.89%. Given TAT Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe TAT Technologies is more favorable than Moog.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Moog	$3.86 billion	2.82	$235.03 million	$6.59	52.11
TAT Technologies	$172.53 million	4.20	$11.17 million	$1.33	43.40

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

Volatility & Risk

Moog has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500. Comparatively, TAT Technologies has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Moog	6.38%	15.47%	6.85%
TAT Technologies	9.08%	11.10%	8.12%

Dividends

Moog pays an annual dividend of $1.20 per share and has a dividend yield of 0.3%. TAT Technologies pays an annual dividend of $0.34 per share and has a dividend yield of 0.6%. Moog pays out 18.2% of its earnings in the form of a dividend. TAT Technologies pays out 25.6% 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.

Summary

TAT Technologies beats Moog on 12 of the 17 factors compared between the two stocks.

About Moog

Moog Inc. designs, manufactures, and integrates precision motion and fluid controls and systems for original equipment manufacturers and end users in the aerospace, defense, and industrial markets worldwide. The company's Aircrafts Controls segment offers primary and secondary flight controls for military and commercial aircrafts; aftermarket support services; and ground-based navigation aids. Its Space and Defense Controls segment provides controls for satellites, space vehicles, launch vehicles, armored combat vehicles, tactical and strategic missiles, security and surveillance, and other defense applications; and gun aiming, stabilization, and automatic ammunition loading for armored combat vehicles. This segment also offers steering tactical and strategic missiles; and designs, builds, and integrates weapon stores management systems for light attack aerial reconnaissance, ground, and sea platforms. The company's Industrial Systems segment provides systems for applications in injection and blow molding machinery, metal forming presses, and heavy industry customers in steel and aluminum production; and supplies solutions for power generation applications, electromechanical motion simulation bases, medical training simulators, and custom test systems and controls. This segment also offers systems and components for applications in oil and gas exploration and production; components for wind turbine applications; and components and systems for diagnostic imaging CT scan medical equipment, sleep apnea equipment, oxygen concentrators, infusion therapy, and enteral clinical nutrition. The company was founded in 1951 and is headquartered in East Aurora, New York.

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.