Critical Review: VSE (VSEC) versus Its Rivals

VSE (NASDAQ:VSEC) is one of 229 publicly-traded companies in the “Aerospace & Defense” industry, but how does it weigh in compared to its rivals? We will compare VSE to related companies based on the strength of its earnings, valuation, profitability, analyst recommendations, risk, institutional ownership and dividends.

Profitability

This table compares VSE and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
VSE	7.87%	7.10%	5.00%
VSE Competitors	-329.31%	-49.26%	-4.60%

Insider and Institutional Ownership

91.5% of VSE shares are held by institutional investors. Comparatively, 49.5% of shares of all “Aerospace & Defense” companies are held by institutional investors. 1.8% of VSE shares are held by company insiders. Comparatively, 11.8% of shares of all “Aerospace & Defense” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

VSE pays an annual dividend of $0.40 per share and has a dividend yield of 0.2%. VSE pays out 9.0% of its earnings in the form of a dividend. As a group, “Aerospace & Defense” companies pay a dividend yield of 1.1% and pay out 39.1% of their earnings in the form of a dividend.

Volatility & Risk

VSE has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, VSE’s rivals have a beta of 1.32, meaning that their average share price is 32% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for VSE and its rivals, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
VSE	0	4	8	1	2.77
VSE Competitors	2173	8290	12826	582	2.50

VSE currently has a consensus price target of $254.00, suggesting a potential upside of 39.85%. As a group, “Aerospace & Defense” companies have a potential upside of 30.24%. Given VSE’s stronger consensus rating and higher probable upside, analysts plainly believe VSE is more favorable than its rivals.

Earnings and Valuation

This table compares VSE and its rivals revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
VSE	$1.11 billion	$11.70 million	41.09
VSE Competitors	$8.45 billion	$569.54 million	14.86

VSE’s rivals have higher revenue and earnings than VSE. VSE is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Summary

VSE beats its rivals on 10 of the 15 factors compared.

VSE Company Profile

VSE is an aftermarket aviation services and parts provider. The company distributes replacement parts and supplies repair, maintenance, and other support services for commercial, business, and general aviation customers. Its aviation business works with airlines, aircraft operators, maintenance providers, and original equipment manufacturers to help keep aircraft and related components in service. VSE serves customers in the United States and international markets. Founded in 1959, VSE began as a provider of engineering and technical services to the U.S. government and later expanded into aviation aftermarket services.