Analyzing Rocket Lab (NASDAQ:RKLB) and TAT Technologies (NASDAQ:TATT)

TAT Technologies (NASDAQ:TATT) and Rocket Lab (NASDAQ:RKLB) are both aerospace companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, dividends, risk, institutional ownership, profitability, analyst recommendations and valuation.

Volatility & Risk

TAT Technologies has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500. Comparatively, Rocket Lab has a beta of 2.16, indicating that its share price is 116% more volatile than the S&P 500.

Insider and Institutional Ownership

15.1% of TAT Technologies shares are held by institutional investors. Comparatively, 71.8% of Rocket Lab shares are held by institutional investors. 8.8% of TAT Technologies shares are held by insiders. Comparatively, 11.9% of Rocket Lab shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares TAT Technologies and Rocket Lab”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TAT Technologies	$152.12 million	4.06	$11.17 million	$1.33	36.98
Rocket Lab	$436.21 million	82.58	-$190.18 million	($0.38)	-177.47

TAT Technologies has higher earnings, but lower revenue than Rocket Lab. Rocket Lab is trading at a lower price-to-earnings ratio than TAT Technologies, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations and price targets for TAT Technologies and Rocket Lab, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TAT Technologies	0	1	6	1	3.00
Rocket Lab	1	6	7	1	2.53

TAT Technologies presently has a consensus target price of $53.17, suggesting a potential upside of 8.08%. Rocket Lab has a consensus target price of $72.92, suggesting a potential upside of 8.12%. Given Rocket Lab’s higher possible upside, analysts plainly believe Rocket Lab is more favorable than TAT Technologies.

Profitability

This table compares TAT Technologies and Rocket Lab’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TAT Technologies	9.08%	11.10%	8.12%
Rocket Lab	-35.64%	-27.26%	-12.21%

About TAT Technologies

TAT Technologies Ltd., together with its subsidiaries, provides solutions and services to the commercial and military aerospace, and ground defense industries in the United States, Israel, and internationally. The company operates through four segments: Original Equipment Manufacturing (OEM) of Heat Transfer Solutions and Aviation Accessories; Maintenance, Repair, and Overhaul (MRO) Services for Heat Transfer Components and OEM of Heat Transfer Solutions; MRO Services for Aviation Components; and Overhaul and Coating of Jet Engine Components. It designs, develops, and manufactures a range of heat transfer solutions, such as pre-cooler and oil/fuel hydraulic heat exchangers used in mechanical and electronic systems in commercial, military, and business aircraft; environmental control and power electronics cooling systems for use in aircraft and ground applications; and a range of other mechanical aircraft accessories and systems, such as pumps, valves, and turbine power units. The company provides MRO services for heat transfer components, as well as for manufacturing heat transfer solutions; and aviation components. In addition, it engages in the operation of a repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers, and the military; and the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes, and afterburner flaps. The company was formerly known as Galagraph Ltd. and changed its name to TAT Technologies Ltd. in May 1992. TAT Technologies Ltd. was founded in 1969 and is headquartered in Netanya, Israel.

About Rocket Lab

Rocket Lab USA, Inc., a space company, provides launch services and space systems solutions for the space and defense industries. The company provides launch services, spacecraft design services, spacecraft components, spacecraft manufacturing, and other spacecraft and on-orbit management solutions; and constellation management services, as well as designs and manufactures small and medium-class rockets. It also designs, manufactures, and sells Electron, a reusable orbital-class small rocket; and the Photon satellite platforms, as well as developing the Neutron 8-ton payload class launch vehicle; conducts remote launch activities; and designs and manufactures a range of components and subsystems for the Photon family of spacecraft and broader merchant spacecraft components. The company serves commercial, aerospace prime contractors, and government customers. Rocket Lab USA, Inc. was founded in 2006 and is headquartered in Long Beach, California.