Critical Comparison: AEVEX (NYSE:AVEX) & Kratos Defense & Security Solutions (NASDAQ:KTOS)

Kratos Defense & Security Solutions (NASDAQ:KTOS) and AEVEX (NYSE:AVEX) are both industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.

Analyst Ratings

This is a summary of current ratings and recommmendations for Kratos Defense & Security Solutions and AEVEX, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kratos Defense & Security Solutions	2	1	20	2	2.88
AEVEX	1	2	11	0	2.71

Kratos Defense & Security Solutions currently has a consensus price target of $89.50, indicating a potential upside of 131.39%. AEVEX has a consensus price target of $28.73, indicating a potential upside of 163.79%. Given AEVEX’s higher possible upside, analysts plainly believe AEVEX is more favorable than Kratos Defense & Security Solutions.

Earnings & Valuation

This table compares Kratos Defense & Security Solutions and AEVEX”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kratos Defense & Security Solutions	$1.52 billion	4.77	$22.00 million	$0.17	227.53
AEVEX	N/A	N/A	N/A	$0.32	34.03

Kratos Defense & Security Solutions has higher revenue and earnings than AEVEX. AEVEX is trading at a lower price-to-earnings ratio than Kratos Defense & Security Solutions, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

75.9% of Kratos Defense & Security Solutions shares are owned by institutional investors. 1.5% of Kratos Defense & Security Solutions shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Kratos Defense & Security Solutions and AEVEX’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kratos Defense & Security Solutions	2.03%	3.07%	2.55%
AEVEX	N/A	N/A	N/A

Summary

Kratos Defense & Security Solutions beats AEVEX on 10 of the 12 factors compared between the two stocks.

About Kratos Defense & Security Solutions

Kratos Defense & Security Solutions, Inc. engages in the provision of mission critical products, services and solutions for United States national security priorities. It operates through the Kratos Government Solutions (KGS) and Unmanned Systems (US) segments. The KGS segment consists of an aggregation of KGS operating segments, including microwave electronic products, space, satellite and cyber, training solutions. The US segment refers to the unmanned aerial, unmanned ground, unmanned seaborne and related command, control and communications system businesses. The company was founded on December 19, 1994, and is headquartered in Round Rock, TX.

About AEVEX

AEVEX Corp. is a holding company which designs, manufactures and provides autonomous systems and navigation technologies. The company’s operating segment includes tactical systems and global solutions. AEVEX Corp. is based in Solana Beach, California.