Reviewing FTAI Aviation (NASDAQ:FTAI) and Huntington Ingalls Industries (NYSE:HII)

Huntington Ingalls Industries (NYSE:HII) and FTAI Aviation (NASDAQ:FTAI) are both large-cap industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, valuation, dividends, profitability and analyst recommendations.

Dividends

Huntington Ingalls Industries pays an annual dividend of $5.52 per share and has a dividend yield of 1.8%. FTAI Aviation pays an annual dividend of $2.00 per share and has a dividend yield of 1.1%. Huntington Ingalls Industries pays out 29.7% of its earnings in the form of a dividend. FTAI Aviation pays out 40.6% 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. Huntington Ingalls Industries has raised its dividend for 13 consecutive years. Huntington Ingalls Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Huntington Ingalls Industries and FTAI Aviation, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Huntington Ingalls Industries	0	5	4	1	2.60
FTAI Aviation	0	2	8	0	2.80

Huntington Ingalls Industries presently has a consensus target price of $366.12, indicating a potential upside of 16.85%. FTAI Aviation has a consensus target price of $304.38, indicating a potential upside of 61.90%. Given FTAI Aviation’s stronger consensus rating and higher possible upside, analysts plainly believe FTAI Aviation is more favorable than Huntington Ingalls Industries.

Risk and Volatility

Huntington Ingalls Industries has a beta of 0.17, indicating that its stock price is 83% less volatile than the S&P 500. Comparatively, FTAI Aviation has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500.

Institutional and Insider Ownership

90.5% of Huntington Ingalls Industries shares are owned by institutional investors. Comparatively, 89.0% of FTAI Aviation shares are owned by institutional investors. 0.8% of Huntington Ingalls Industries shares are owned by company insiders. Comparatively, 1.4% of FTAI Aviation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Huntington Ingalls Industries and FTAI Aviation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Huntington Ingalls Industries	5.42%	13.95%	5.76%
FTAI Aviation	15.46%	132.04%	11.63%

Valuation & Earnings

This table compares Huntington Ingalls Industries and FTAI Aviation”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Huntington Ingalls Industries	$12.48 billion	0.99	$605.00 million	$18.58	16.86
FTAI Aviation	$3.42 billion	5.62	$501.06 million	$4.93	38.13

Huntington Ingalls Industries has higher revenue and earnings than FTAI Aviation. Huntington Ingalls Industries is trading at a lower price-to-earnings ratio than FTAI Aviation, indicating that it is currently the more affordable of the two stocks.

Summary

FTAI Aviation beats Huntington Ingalls Industries on 10 of the 18 factors compared between the two stocks.

About Huntington Ingalls Industries

Huntington Ingalls Industries, Inc. (NYSE: HII) is a U.S. defense contractor focused on shipbuilding and technology services. Its shipyards design, build, and maintain vessels for the U.S. Navy and other government customers, including nuclear-powered aircraft carriers, submarines, destroyers, and amphibious ships. The company operates Newport News Shipbuilding in Virginia and Ingalls Shipbuilding in Mississippi. Newport News is the sole designer and builder of U.S. Navy nuclear-powered aircraft carriers and, alongside General Dynamics Electric Boat, builds the Navy’s nuclear-powered submarines.

About FTAI Aviation

FTAI Aviation owns and manages a portfolio of commercial jet engines and aircraft, which it leases to airlines and other aviation customers around the world. Its business focuses on mid-life equipment, providing customers with access to engines and aircraft without requiring them to own those assets outright. The company also supports its leasing operations with maintenance, repair and overhaul services, as well as the sale and exchange of engine modules and parts. Its work is particularly focused on the CFM56 and V2500 engine families, which are widely used on commercial aircraft.