Heico (NYSE:HEI) and Honeywell International (NYSE:HON) are both large-cap aerospace companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, earnings, valuation, dividends, institutional ownership and risk.
Insider & Institutional Ownership
26.5% of Heico shares are held by institutional investors. Comparatively, 76.3% of Honeywell International shares are held by institutional investors. 8.6% of Heico shares are held by company insiders. Comparatively, 0.6% of Honeywell International shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
This table compares Heico and Honeywell International’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility & Risk
Heico has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500. Comparatively, Honeywell International has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500.
Heico pays an annual dividend of $0.16 per share and has a dividend yield of 0.2%. Honeywell International pays an annual dividend of $3.60 per share and has a dividend yield of 2.4%. Heico pays out 7.0% of its earnings in the form of a dividend. Honeywell International pays out 44.1% 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. Heico has increased its dividend for 10 consecutive years and Honeywell International has increased its dividend for 9 consecutive years.
This is a summary of current ratings and recommmendations for Heico and Honeywell International, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Heico presently has a consensus price target of $100.50, suggesting a potential upside of 6.37%. Honeywell International has a consensus price target of $157.75, suggesting a potential upside of 6.51%. Given Honeywell International’s stronger consensus rating and higher possible upside, analysts plainly believe Honeywell International is more favorable than Heico.
Earnings and Valuation
This table compares Heico and Honeywell International’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Heico||$2.06 billion||6.19||$327.90 million||$2.30||41.08|
|Honeywell International||$36.71 billion||2.83||$6.14 billion||$8.16||18.15|
Honeywell International has higher revenue and earnings than Heico. Honeywell International is trading at a lower price-to-earnings ratio than Heico, indicating that it is currently the more affordable of the two stocks.
Honeywell International beats Heico on 9 of the 17 factors compared between the two stocks.
HEICO Corporation, through its subsidiaries, designs, manufactures, and sells aerospace, defense, and electronic related products and services in the United States and internationally. The company's Flight Support Group segment provides jet engine and aircraft component replacement parts; thermal insulation blankets and parts; renewable/reusable insulation systems; and specialty components. This segment also distributes hydraulic, pneumatic, structural, interconnect, mechanical, and electro-mechanical components for the commercial, regional, and general aviation markets; and offers repair and overhaul services for jet engine and aircraft component parts, avionics, instruments, composites, and flight surfaces of commercial aircraft, as well as for avionics and navigation systems, subcomponents, and other instruments utilized on military aircraft. Its Electronic Technologies Group segment provides electro-optical infrared simulation and test equipment; electro-optical laser products; electro-optical, microwave, and other power equipment; electromagnetic and radio interference shielding; high-speed interface products; high voltage interconnection devices; high voltage advanced power electronics; power conversion products; and underwater locator beacons and emergency locator transmission beacons. This segment also offers traveling wave tube amplifiers and microwave power modules; three-dimensional microelectronic and stacked memory products; harsh environment connectivity products and custom molded cable assemblies; radio frequency and microwave amplifiers, transmitters, and receivers; communications and electronic intercept receivers and tuners; self-sealing auxiliary fuel systems; active antenna systems; and nuclear radiation detectors. The company serves the U.S. and foreign military agencies; prime defense contractors; and commercial and defense satellite and spacecraft manufacturers. HEICO Corporation was founded in 1949 and is headquartered in Hollywood, Florida.
About Honeywell International
Honeywell International Inc. operates as a diversified technology and manufacturing company worldwide. Its Aerospace segment supplies products, software, and services for aircrafts and vehicles. This segment offers auxiliary power units, propulsion engines, integrated avionics, environmental control and electric power systems, engine controls, flight safety, communications, navigation hardware, data and software applications, radar and surveillance systems, aircraft lighting, advanced systems and instruments, satellite and space components, and aircraft wheels and brakes; spare parts; repair, overhaul, and maintenance services; and connected solutions and data services for the aftermarket, as well as provides wireless connectivity and management and technical services. The company's Honeywell Building Technologies segment offers products, software, solutions, and technologies, such as sensors, switches, control systems and instruments for energy management; access control; video surveillance; fire products; remote patient monitoring systems; advanced software applications; and installation, maintenance and upgrades of systems. Its Performance Materials and Technologies segment develops and manufactures process technology products, including catalysts and adsorbents, equipment, and consulting services. The company's Safety and Productivity Solutions segment provides products, software, and connected solutions. Its safety products comprise personal protection equipment, apparel, gear, and footwear; gas detection technology; and cloud-based notification and emergency messaging. This segment's productivity solutions products and services include mobile devices and software; supply chain and warehouse automation equipment, software and solutions; custom-engineered sensors, switches, and controls; and software-based data and asset management productivity solutions. Honeywell International Inc. was incorporated in 1985 and is based in Morris Plains, New Jersey.
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