Financial Survey: SkyWest (NASDAQ:SKYW) & Air China (OTCMKTS:AIRYY)

SkyWest (NASDAQ:SKYW) and Air China (OTCMKTS:AIRYY) are both transportation companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, valuation, earnings and risk.

Profitability

This table compares SkyWest and Air China’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SkyWest	10.56%	16.35%	5.93%
Air China	0.19%	0.79%	0.09%

Institutional and Insider Ownership

81.3% of SkyWest shares are owned by institutional investors. 2.0% of SkyWest shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations for SkyWest and Air China, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SkyWest	0	2	4	1	2.86
Air China	0	0	0	0	0.00

SkyWest presently has a consensus target price of $123.83, indicating a potential upside of 38.33%. Given SkyWest’s stronger consensus rating and higher probable upside, research analysts plainly believe SkyWest is more favorable than Air China.

Valuation & Earnings

This table compares SkyWest and Air China”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SkyWest	$4.06 billion	0.89	$428.33 million	$10.35	8.65
Air China	$23.19 billion	0.59	-$32.35 million	$0.02	781.50

SkyWest has higher earnings, but lower revenue than Air China. SkyWest is trading at a lower price-to-earnings ratio than Air China, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

SkyWest has a beta of 1.58, indicating that its stock price is 58% more volatile than the S&P 500. Comparatively, Air China has a beta of -0.14, indicating that its stock price is 114% less volatile than the S&P 500.

Summary

SkyWest beats Air China on 13 of the 15 factors compared between the two stocks.

About SkyWest

SkyWest, Inc. is the holding company for two scheduled passenger airline operations and an aircraft leasing company. SkyWest’s airline companies provide commercial air service in cities throughout North America with nearly 3,000 daily flights carrying more than 53 million passengers annually. SkyWest Airlines operates through partnerships with United Airlines, Delta Air Lines, American Airlines and Alaska Airlines. ExpressJet Airlines operates through partnerships with United Airlines, Delta Air Lines and American Airlines. Based in St. George, Utah, SkyWest employs nearly 17,000 employees.

About Air China

Air China Limited, together with its subsidiaries, provides air passenger, air cargo, and airline-related services in Mainland China, Hong Kong, Macau, Taiwan, China, and internationally. The company operates in Airline Operations and Other Operations segments. It provides aircraft engineering and airport ground handling services. The company is also involved in the import and export trading activities; and provision of cabin, airline catering, air ticketing, human resources, aircraft overhaul and maintenance, and financial services. Air China Limited was founded in 1988 and is headquartered in Beijing, the People's Republic of China.