Financial Review: Ducommun (NYSE:DCO) & Meggitt (OTCMKTS:MEGGF)

Meggitt (OTCMKTS:MEGGF) and Ducommun (NYSE:DCO) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, analyst recommendations, profitability, institutional ownership and earnings.

Institutional & Insider Ownership

54.1% of Meggitt shares are held by institutional investors. Comparatively, 92.2% of Ducommun shares are held by institutional investors. 8.8% of Ducommun shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Meggitt and Ducommun’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Meggitt	N/A	N/A	N/A
Ducommun	2.95%	6.79%	3.86%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Meggitt and Ducommun, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Meggitt	0	0	0	0	N/A
Ducommun	0	0	4	0	3.00

Ducommun has a consensus target price of $71.00, indicating a potential upside of 9.65%. Given Ducommun’s higher possible upside, analysts plainly believe Ducommun is more favorable than Meggitt.

Valuation & Earnings

This table compares Meggitt and Ducommun”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Meggitt	N/A	N/A	N/A	$0.26	33.94
Ducommun	$776.33 million	1.23	$15.93 million	$1.19	54.41

Ducommun has higher revenue and earnings than Meggitt. Meggitt is trading at a lower price-to-earnings ratio than Ducommun, indicating that it is currently the more affordable of the two stocks.

Summary

Ducommun beats Meggitt on 10 of the 10 factors compared between the two stocks.

About Meggitt

Meggitt PLC designs and manufactures components and sub-systems in the United Kingdom, rest of Europe, the United States, and internationally. The company operates in four segments: Airframe Systems, Engine Systems, Energy & Equipment, and Services & Support. It offers ice protection products, radomes, and structures; air data and flight display products; brake control and tyre pressure monitoring systems, and wheels and brakes; engine health and vibration monitors, H2/O2 analyzers, and turbine monitoring and protection products; and aircraft cameras and security systems, and wireless aircraft systems. The company also provides ammunition handling, thermal, weapon scoring, and weapon training systems; energy storage, power conversion and distribution, and power generation systems; ducting systems, engine composites, and flow control valves; and fire protection and controls comprising bleed air leak detection products, cables, electronic control units, fire and overheat detection products, and fire suppression products. In addition, it offers ground fueling, and fuel systems and tanks; motion control actuators, electric motor drives, and electric motors; oxygen and specialty restraint systems; and accelerometers, ceramics, fluid sensors, magnetic and current sensors, position and inertial sensors, pressure sensors, speed sensors, and temperature sensors. Further, the company provides polymer seals; heat exchangers, printed circuit heat exchangers, thermal components, and thermal management systems; and live fire and virtual trainers, as well as aftermarket services. It serves aerospace, defense, and energy and equipment markets. The company was formerly known as Meggitt Holdings Public Limited Company and changed its name to Meggitt PLC in April 1989. Meggitt PLC was incorporated in 1947 and is headquartered in Coventry, the United Kingdom.

About Ducommun

Ducommun Incorporated provides engineering and manufacturing services for products and applications used primarily in the aerospace and defense, industrial, medical, and other industries in the United States. The company operates through two segments, Electronic Systems and Structural Systems. The Electronic Systems segment provides cable assemblies and interconnect systems; printed circuit board assemblies; electronic, electromechanical, and mechanical components and assemblies, as well as lightning diversion systems; and radar enclosures, aircraft avionics racks, shipboard communications and control enclosures, printed circuit board assemblies, cable assemblies, wire harnesses, interconnect systems, lightning diversion strips, surge suppressors, conformal shields, and other assemblies. The segment also supplies engineered products, including illuminated pushbutton switches and panels for aviation and test systems; microwave and millimeter switches and filters for radio frequency systems and test instrumentation; and motors and resolvers for motion control. In addition, this segment provides engineering expertise for aerospace system design, development, integration, and testing. The Structural Systems segment designs, engineers, and manufactures contoured aluminum, titanium, and Inconel aero structure components; structural assembly products, such as winglets, engine components, and fuselage structural panels; aerodynamic systems; and metal and composite bonded structures and assemblies comprising aircraft wing spoilers, large fuselage skins, rotor blades on rotary-wing aircraft and components, flight control surfaces, engine components, ammunition handling systems, and magnetic seals. It serves commercial aircraft, military fixed-wing aircraft, military and commercial rotary-wing aircraft, and space programs, as well as industrial, medical, and other end-use markets. The company was founded in 1849 and is headquartered in Santa Ana, California.