Analyzing V2X (NYSE:VVX) & Red Cat (NASDAQ:RCAT)

Red Cat (NASDAQ:RCAT) and V2X (NYSE:VVX) are both industrials companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, risk, profitability, dividends and valuation.

Insider & Institutional Ownership

38.0% of Red Cat shares are owned by institutional investors. Comparatively, 95.2% of V2X shares are owned by institutional investors. 12.5% of Red Cat shares are owned by company insiders. Comparatively, 1.0% of V2X shares are owned 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.

Valuation & Earnings

This table compares Red Cat and V2X”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Red Cat	$40.73 million	24.88	-$72.07 million	($0.81)	-10.19
V2X	$4.48 billion	0.53	$77.88 million	$2.90	25.92

V2X has higher revenue and earnings than Red Cat. Red Cat is trading at a lower price-to-earnings ratio than V2X, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Red Cat and V2X’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Red Cat	-136.26%	-32.25%	-28.48%
V2X	1.88%	17.52%	6.00%

Analyst Recommendations

This is a breakdown of recent ratings for Red Cat and V2X, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Red Cat	1	1	5	2	2.89
V2X	1	7	6	0	2.36

Red Cat presently has a consensus target price of $18.00, indicating a potential upside of 118.05%. V2X has a consensus target price of $86.90, indicating a potential upside of 15.63%. Given Red Cat’s stronger consensus rating and higher possible upside, analysts clearly believe Red Cat is more favorable than V2X.

Volatility and Risk

Red Cat has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500. Comparatively, V2X has a beta of 0.17, meaning that its share price is 83% less volatile than the S&P 500.

Summary

V2X beats Red Cat on 9 of the 15 factors compared between the two stocks.

About Red Cat

Red Cat Holdings, Inc. engages in the provision of various products, services, and solutions to the drone industry. The company operates through two segments: Enterprise and Consumer. It built infrastructure to manages drone fleets and fly, and provide services remotely, navigate confined industrial interior spaces and dangerous military environment. Red Cat Holdings, Inc. is based in San Juan, Puerto Rico.

About V2X

V2X, Inc. provides critical mission solutions and support services to defense clients worldwide. It offers a suite of integrated solutions across the operations and logistics, aerospace, training, and technology markets to national security, defense, civilian, and international clients. The company was incorporated in 2014 and is headquartered in Mclean, Virginia.