Head to Head Analysis: Magellan Aerospace (OTCMKTS:MALJF) and Thales (OTCMKTS:THLEF)

Magellan Aerospace (OTCMKTS:MALJF) and Thales (OTCMKTS:THLEF) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.

Dividends

Magellan Aerospace pays an annual dividend of $0.15 per share and has a dividend yield of 2.2%. Thales pays an annual dividend of $1.12 per share and has a dividend yield of 0.8%. Magellan Aerospace pays out 15.7% of its earnings in the form of a dividend. Thales pays out 27.6% 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. Magellan Aerospace is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Magellan Aerospace and Thales, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magellan Aerospace	0	0	1	0	3.00
Thales	0	0	0	0	0.00

Magellan Aerospace currently has a consensus price target of $14.00, indicating a potential upside of 101.15%. Given Magellan Aerospace’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Magellan Aerospace is more favorable than Thales.

Valuation and Earnings

This table compares Magellan Aerospace and Thales”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Magellan Aerospace	N/A	N/A	N/A	$0.95	7.30
Thales	N/A	N/A	N/A	$4.07	34.88

Magellan Aerospace is trading at a lower price-to-earnings ratio than Thales, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

3.9% of Magellan Aerospace shares are held by institutional investors. Comparatively, 20.8% of Thales shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Magellan Aerospace and Thales’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Magellan Aerospace	N/A	N/A	N/A
Thales	N/A	N/A	N/A

Summary

Magellan Aerospace beats Thales on 5 of the 8 factors compared between the two stocks.

About Magellan Aerospace

Magellan Aerospace Corporation, through its subsidiaries, engineers and manufactures aeroengine and aerostructure components for aerospace markets in Canada, the United States, and Europe. The company offers aero engine products, such as laser welded honeycomb and filament wound tubes, frames, compressor components, bypass ducts, hot section components, and aeroengine and helicopter drive shafts, as well as other flight safety critical machined components, including discs, seals, and spacers; and aerostructures comprising landing gear systems, wing ribs, spars and skins, bulkheads and fuselage components, tailcone assemblies, composite wing and fairing structures, horizontal and vertical stabilizers, plug and nozzle, exhaust systems, crown modules, and vane boxes and transition ducts. It also designs, engineers, and manufactures assemblies and components, such as stage rocket motors, solid propellant rocket motors, and rocket weapon systems; wire strike protection systems for helicopter safety; space solutions, including small satellite bus platforms and satellite subsystem equipment, as well as offers services for satellite assembly, integration, and testing; and aluminum and magnesium alloy sand castings, such as engine mounted accessory gearbox housings, helicopter power transmission housings, auxiliary power unit inlet and gearbox housings, engine front inlet and intermediate cases, engine front frames and fan cases, pump and accessory drive housings, and environmental control housings. In addition, the company offers maintenance, repair, and overhaul for various engine and components MRO, as well as lifecycle management services to logistics, fleet management, and engineering services. Magellan Aerospace Corporation was incorporated in 1996 and is headquartered in Mississauga, Canada.

About Thales

Thales S.A. provides various solutions in the defence and security, aerospace and space, digital identity and security, and transport markets worldwide. It operates through Aerospace, Defence & Security, Digital Identity & Security, and Ground Transportation Systems business segments. The company offers communications, command, and control systems; mission services and support; protection and mission/combat systems; surveillance, detection, and intelligence systems; training and simulation solutions for air, land, naval, and joint forces; and digital identity and security solutions. It also provides air traffic management solutions; flight decks and avionics equipment and functions; in-flight entertainment, connectivity, and services; drone solutions; aerospace trading solutions; navigation solutions; support and services for civil aviation; and connectivity solutions. In addition, the company designs, operates, and delivers satellite-based systems for telecommunications, navigation, earth observation, environmental management, exploration, and science and orbital infrastructures; signaling, communications and supervision, and fare collection management systems and related services; cybersecurity and railway digitalization systems; and main line rail, and urban and intermodal mobility solutions. Further, it provides solutions for various markets and applications, including radiology, radio frequency, microwave sources, training and simulation solutions, lasers, and microelectronics solutions for science, industry, space, defense, automotive, railways, and energy conversion platforms. The company was formerly known as Thomson-CSF and changed its name to Thales S.A. in 2000. Thales S.A. was founded in 1893 and is headquartered in Meudon, France.