Contrasting Boeing Company (The) (NYSE:BA) and Textron (TXT)
Boeing Company (The) (NYSE: BA) and Textron (NYSE:TXT) are both large-cap aerospace companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitabiliy, dividends, analyst recommendations, earnings, institutional ownership and risk.
Valuation and Earnings
This table compares Boeing Company (The) and Textron’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Boeing Company (The)||$92.92 billion||1.35||$8.92 billion||$8.16||25.55|
|Textron||$13.68 billion||0.97||$1.53 billion||$3.35||14.82|
Boeing Company (The) has higher revenue and earnings than Textron. Textron is trading at a lower price-to-earnings ratio than Boeing Company (The), indicating that it is currently the more affordable of the two stocks.
This table compares Boeing Company (The) and Textron’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Boeing Company (The)||5.52%||495.68%||5.30%|
Volatility and Risk
Boeing Company (The) has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500. Comparatively, Textron has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500.
Boeing Company (The) pays an annual dividend of $5.68 per share and has a dividend yield of 2.7%. Textron pays an annual dividend of $0.08 per share and has a dividend yield of 0.2%. Boeing Company (The) pays out 69.6% of its earnings in the form of a dividend. Textron pays out 2.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Boeing Company (The) has raised its dividend for 5 consecutive years. Boeing Company (The) is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of recent ratings and recommmendations for Boeing Company (The) and Textron, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Boeing Company (The)||4||6||12||0||2.36|
Boeing Company (The) currently has a consensus target price of $181.79, suggesting a potential downside of 12.81%. Textron has a consensus target price of $52.75, suggesting a potential upside of 6.27%. Given Textron’s stronger consensus rating and higher probable upside, analysts plainly believe Textron is more favorable than Boeing Company (The).
Institutional & Insider Ownership
73.0% of Boeing Company (The) shares are owned by institutional investors. Comparatively, 82.7% of Textron shares are owned by institutional investors. 0.3% of Boeing Company (The) shares are owned by insiders. Comparatively, 1.1% of Textron shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Boeing Company (The) beats Textron on 10 of the 17 factors compared between the two stocks.
Boeing Company (The) Company Profile
The Boeing Company is an aerospace company. The Company’s segments include Commercial Airplanes; Defense, Space & Security (BDS), such as Boeing Military Aircraft (BMA), Network & Space Systems (N&SS) and Global Services & Support (GS&S), and Boeing Capital (BCC). The Commercial Airplanes segment develops, produces and markets commercial jet aircraft and provides related support services, to the commercial airline industry. The Commercial Airplanes segment also produces commercial aircraft and offers a family of commercial jetliners. The BDS segment’s operations involve research, development, production, modification and support of the products and related systems. The BMA segment is engaged in the research, development, production and modification of manned and unmanned military aircraft and weapons systems. The BCC segment’s portfolio consists of equipment under operating leases, finance leases, notes and other receivables, assets held for sale or re-lease and investments.
Textron Company Profile
Textron Inc. is a multi-industry company engaged in aircraft, defense, industrial and finance businesses to provide customers with products and services across the world. The Company operates through five segments: Textron Aviation, Bell, Textron Systems, Industrial and Finance. The Textron Aviation segment is engaged in general aviation. The Bell segment supplies military helicopters and support to the United States Government and to military customers outside the United States. The Textron Systems segment is a supplier to the defense, aerospace and general aviation markets. The Industrial segment designs and manufactures a range of products within three product lines: fuel systems and functional components, specialized vehicles and equipment, and tools and test equipment. The Finance segment is a commercial finance business that consists of Textron Financial Corporation (TFC) and its subsidiaries.
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