Critical Review: TAT Technologies (NASDAQ:TATT) & Astronics (OTCMKTS:ATROB)

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

Volatility and Risk

TAT Technologies has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500. Comparatively, Astronics has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
TAT Technologies	9.08%	11.10%	8.12%
Astronics	3.41%	39.95%	11.66%

Analyst Ratings

This is a summary of current recommendations for TAT Technologies and Astronics, as provided by MarketBeat.

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

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

Valuation & Earnings

This table compares TAT Technologies and Astronics”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TAT Technologies	$152.12 million	4.77	$11.17 million	$1.33	43.40
Astronics	$862.13 million	2.91	$29.36 million	$0.77	91.55

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

Institutional and Insider Ownership

15.1% of TAT Technologies shares are owned by institutional investors. 8.8% of TAT Technologies shares are owned by company insiders. Comparatively, 16.0% of Astronics shares are owned 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.

Summary

TAT Technologies beats Astronics on 8 of the 15 factors compared between the two stocks.

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.

About Astronics

Astronics Corporation, through its subsidiaries, designs and manufactures products for the aerospace, defense, and electronics industries in the United States, rest of North America, Asia, Europe, South America, and internationally. The company operates in two segments, Aerospace and Test Systems. The Aerospace segment offers lighting and safety systems, electrical power generation systems, distribution and seat motions systems, aircraft structures, avionics products, system certification, and other products. This segment serves airframe manufacturers (OEM) that build aircraft for the commercial, military, and general aviation markets; suppliers to OEMs; and aircraft operators, such as airlines; suppliers to the aircraft operators; and branches of the U.S. Department of Defense. The Test Systems segment designs, develops, manufactures, and maintains automated test systems that support the aerospace and defense, and mass transit industries, as well as training and simulation devices for commercial and military applications. It serves OEMs and prime government contractors for electronics and military products. Astronics Corporation was incorporated in 1968 and is headquartered in East Aurora, New York.