Analyzing CAE (NYSE:CAE) & FTAI Aviation (NASDAQ:FTAI)

FTAI Aviation (NASDAQ:FTAI) and CAE (NYSE:CAE) are both industrials companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.

Institutional & Insider Ownership

89.0% of FTAI Aviation shares are held by institutional investors. Comparatively, 67.4% of CAE shares are held by institutional investors. 1.4% of FTAI Aviation shares are held by company insiders. Comparatively, 18.3% of CAE shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares FTAI Aviation and CAE’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FTAI Aviation	15.94%	139.59%	11.26%
CAE	6.36%	7.45%	3.51%

Dividends

FTAI Aviation pays an annual dividend of $2.00 per share and has a dividend yield of 1.1%. CAE pays an annual dividend of $0.33 per share and has a dividend yield of 1.4%. FTAI Aviation pays out 43.5% of its earnings in the form of a dividend. CAE pays out 50.6% 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.

Valuation & Earnings

This table compares FTAI Aviation and CAE”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FTAI Aviation	$2.51 billion	7.35	$501.06 million	$4.60	39.01
CAE	$4.99 billion	1.52	$226.62 million	$0.65	36.51

FTAI Aviation has higher earnings, but lower revenue than CAE. CAE is trading at a lower price-to-earnings ratio than FTAI Aviation, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and price targets for FTAI Aviation and CAE, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FTAI Aviation	0	2	9	0	2.82
CAE	1	4	5	0	2.40

FTAI Aviation presently has a consensus target price of $315.67, indicating a potential upside of 75.92%. CAE has a consensus target price of $31.00, indicating a potential upside of 30.64%. Given FTAI Aviation’s stronger consensus rating and higher possible upside, analysts plainly believe FTAI Aviation is more favorable than CAE.

Risk & Volatility

FTAI Aviation has a beta of 1.51, meaning that its share price is 51% more volatile than the S&P 500. Comparatively, CAE has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500.

Summary

FTAI Aviation beats CAE on 13 of the 16 factors compared between the two stocks.

About FTAI Aviation

FTAI Aviation Ltd. owns and acquires aviation and offshore energy equipment for the transportation of goods and people worldwide. It operates through two segments, Aviation Leasing and Aerospace Products. The Aviation Leasing segment owns and manages aviation assets, including aircraft and aircraft engines, which it leases and sells to customers. As of December 31, 2023, this segment owned and managed 363 aviation assets consisting of 96 commercial aircraft and 267 engines, including eight aircraft and seventeen engines that were located in Russia. The Aerospace Products segment develops, manufactures, repairs, and sells aircraft engines and aftermarket components for aircraft engines. The company was founded in 2011 and is headquartered in New York, New York.

About CAE

CAE Inc., together with its subsidiaries, provides simulation training and critical operations support solutions in Canada, the United States, the United Kingdom, Europe, Asia, the Oceania, Africa, and Rest of the Americas. It operates through two segments, Civil Aviation; and Defense and Security. The Civil Aviation segment offers training solutions for flight, cabin, maintenance, and ground personnel in commercial, business, and helicopter aviation; a range of flight simulation training devices; and ab initio pilot training and crew sourcing services, as well as aircraft flight operations solutions. The Defense and Security segment operates as a training and simulation provider that delivers platform-independent solutions to enable and enhance force readiness and security for defense forces, original equipment manufacturers (OEMs), government agencies, and public safety organizations. The company was formerly known as CAE Industries Ltd. and changed its name to CAE Inc. in 1993. CAE Inc. was incorporated in 1947 and is headquartered in Saint-Laurent, Canada.