Financial Survey: Leonardo DRS (NASDAQ:DRS) versus Astronics (NASDAQ:ATRO)

Astronics (NASDAQ:ATRO) and Leonardo DRS (NASDAQ:DRS) are both aerospace companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Institutional and Insider Ownership

56.7% of Astronics shares are held by institutional investors. Comparatively, 18.8% of Leonardo DRS shares are held by institutional investors. 9.4% of Astronics shares are held by company insiders. Comparatively, 0.3% of Leonardo DRS shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Astronics and Leonardo DRS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Astronics	-0.45%	22.89%	9.16%
Leonardo DRS	7.31%	11.02%	6.93%

Analyst Ratings

This is a summary of recent ratings for Astronics and Leonardo DRS, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Astronics	1	0	1	1	2.67
Leonardo DRS	0	2	7	0	2.78

Astronics currently has a consensus target price of $49.00, suggesting a potential upside of 3.75%. Leonardo DRS has a consensus target price of $46.75, suggesting a potential upside of 5.32%. Given Leonardo DRS’s stronger consensus rating and higher possible upside, analysts clearly believe Leonardo DRS is more favorable than Astronics.

Volatility and Risk

Astronics has a beta of 1.68, meaning that its stock price is 68% more volatile than the S&P 500. Comparatively, Leonardo DRS has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500.

Earnings & Valuation

This table compares Astronics and Leonardo DRS”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Astronics	$822.85 million	2.03	-$16.22 million	($0.12)	-393.58
Leonardo DRS	$3.42 billion	3.45	$213.00 million	$0.93	47.73

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

Summary

Leonardo DRS beats Astronics on 9 of the 15 factors compared between the two stocks.

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.

About Leonardo DRS

Leonardo DRS, Inc., together with its subsidiaries, provides defense electronic products and systems, and military support services. It operates through Advanced Sensing and Computing (ASC) segment, and Integrated Mission Systems (IMS) segments. The ASC segment designs, develops, and manufacture sensing and network computing technology that enables real-time situational awareness required for enhanced operational decision making and execution; and offers sensing capabilities span applications, such as missions requiring advanced detection, precision targeting and surveillance sensing, long range electro-optic/infrared, signals intelligence, and other intelligence systems including electronic warfare, ground vehicle sensing, active electronically scanned array tactical radars, dismounted soldier, and space sensing. This segment also provides network computing, which are utilized across a range of mission applications including platform computing on ground and shipboard for advanced battle management, combat systems, radar, command and control, tactical networks, tactical computing, and communications. The IMS segment designs, develops, manufacture, and integrates power conversion, control, and distribution systems, ship propulsion systems, motors and variable frequency drives, force protection systems, transportation, and logistics systems for the U.S. and allied defense customers. This segment also offers electrical propulsion systems, which includes power conversion, control, distribution, and propulsion systems, as well as power dense permanent magnet motors, energy storage systems and associated efficient, rugged, and compact power conversion, electrical actuation systems, as well as cooling technologies; and motor controllers, instrumentation and control equipment, electrical actuation systems, and thermal management systems. The company was incorporated in 1968 and is based in Arlington, Virginia. Leonardo DRS, Inc. operates as a subsidiary of Leonardo S.p.A.