Saab (OTCMKTS:SAABY – Get Free Report) and Innovative Solutions and Support (NASDAQ:ISSC – Get Free Report) are both aerospace companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, profitability, risk, institutional ownership, analyst recommendations and dividends.
Risk & Volatility
Saab has a beta of -0.19, indicating that its share price is 119% less volatile than the S&P 500. Comparatively, Innovative Solutions and Support has a beta of 0.64, indicating that its share price is 36% less volatile than the S&P 500.
Analyst Ratings
This is a summary of current ratings for Saab and Innovative Solutions and Support, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Saab | 2 | 1 | 0 | 1 | 2.00 |
| Innovative Solutions and Support | 0 | 1 | 1 | 4 | 3.50 |
Dividends
Saab pays an annual dividend of $0.05 per share and has a dividend yield of 0.1%. Innovative Solutions and Support pays an annual dividend of $2.00 per share and has a dividend yield of 10.1%. Saab pays out 6.8% of its earnings in the form of a dividend. Innovative Solutions and Support pays out 190.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Valuation & Earnings
This table compares Saab and Innovative Solutions and Support”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Saab | $8.42 billion | 4.55 | $671.35 million | $0.74 | 48.30 |
| Innovative Solutions and Support | $84.30 million | 4.18 | $15.63 million | $1.05 | 18.89 |
Saab has higher revenue and earnings than Innovative Solutions and Support. Innovative Solutions and Support is trading at a lower price-to-earnings ratio than Saab, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Saab and Innovative Solutions and Support’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Saab | 7.99% | 16.16% | 6.11% |
| Innovative Solutions and Support | 21.02% | 31.80% | 19.52% |
Institutional & Insider Ownership
28.5% of Innovative Solutions and Support shares are held by institutional investors. 4.4% of Innovative Solutions and Support shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Summary
Innovative Solutions and Support beats Saab on 12 of the 17 factors compared between the two stocks.
About Saab
Saab AB (publ) provides products, services, and solutions for military defense, aviation, and civil security markets worldwide. The company operates through Aeronautics, Dynamics, Surveillance, Kockums, and Combitech segments. The company develops military aviation technology, as well as conducts studies on manned and unmanned aircraft. It also provides ground combat weapons, missile systems, torpedoes, unmanned underwater vehicles, training and simulation systems, and signature management systems for armed forces; and niche products for the civil and defense market, such as underwater vehicles for the offshore industry. In addition, the company offers solutions for safety and security, surveillance and decision support, and threat detection, location, and protection, including airborne, ground-based and naval radar, electronic warfare, and combat systems, as well as C4I solutions. Additionally, it provides submarines with the Stirling system for air independent propulsion, surface combatants, mine hunting systems, and autonomous vessels; and systems development, systems integration, information security, systems security, communications, mechanics, and technical product information and logistics. Saab AB (publ) was incorporated in 1937 and is headquartered in Stockholm, Sweden.
About Innovative Solutions and Support
Innovative Solutions and Support, Inc., a systems integrator, designs, develops, manufactures, sells, and services flight guidance, autothrottles, and cockpit display systems in the United States and internationally. It offers flat panel display systems that replicate the display of analog or digital displays on one screen and replace existing displays in legacy aircraft, as well as used for security monitoring on-board aircraft and as tactical workstations on military aircraft; and flight deck management system, a navigation and performance computer that upgrade for commercial air transport aircraft. The company also provides integrated standby units, which incorporate the measurement and display of attitude, altitude, airspeed, and navigation data into a single backup navigation instrument for military, commercial air transport, and corporate/general aviation applications. In addition, it offers digital air data computers that calculate various air data parameters, such as altitude, airspeed, vertical speed, angle of attack, and other information; integrated air data computers and display units, which calculate and convey air data information; altitude displays that convey aircraft altitude measurements; airspeed displays that convey various airspeed measurements; and altitude alerters. Further, the company offers the engine and fuel displays that convey information related to fuel and oil levels, and engine activity, including oil and hydraulic pressure and temperature; integrated global navigation systems; ThrustSense, a full regime autothrottle; and utility management systems. It serves commercial air transport carriers and corporate/general aviation companies, the Department of Defense and its commercial contractors, aircraft operators, aircraft modification centers, government agencies, and foreign militaries, as well as original equipment manufacturers. Innovative Solutions and Support, Inc. was incorporated in 1988 and is based in Exton, Pennsylvania.
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