Critical Analysis: Park Aerospace (NYSE:PKE) and BWX Technologies (NYSE:BWXT)

Park Aerospace (NYSE:PKE) and BWX Technologies (NYSE:BWXT) are both aerospace companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, valuation, risk, dividends, analyst recommendations and institutional ownership.

Valuation & Earnings

This table compares Park Aerospace and BWX Technologies”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Park Aerospace	$62.03 million	6.76	$5.88 million	$0.36	58.61
BWX Technologies	$2.70 billion	6.69	$281.94 million	$3.20	61.83

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

Dividends

Park Aerospace pays an annual dividend of $0.50 per share and has a dividend yield of 2.4%. BWX Technologies pays an annual dividend of $1.00 per share and has a dividend yield of 0.5%. Park Aerospace pays out 138.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BWX Technologies pays out 31.3% of its earnings in the form of a dividend. BWX Technologies has raised its dividend for 2 consecutive years.

Insider & Institutional Ownership

77.8% of Park Aerospace shares are held by institutional investors. Comparatively, 94.4% of BWX Technologies shares are held by institutional investors. 11.3% of Park Aerospace shares are held by company insiders. Comparatively, 0.5% of BWX Technologies shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Park Aerospace and BWX Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Park Aerospace	11.57%	7.96%	6.93%
BWX Technologies	10.28%	30.61%	10.77%

Analyst Recommendations

This is a summary of recent recommendations for Park Aerospace and BWX Technologies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Park Aerospace	0	1	0	0	2.00
BWX Technologies	1	4	6	3	2.79

BWX Technologies has a consensus target price of $164.58, suggesting a potential downside of 16.83%. Given BWX Technologies’ stronger consensus rating and higher probable upside, analysts plainly believe BWX Technologies is more favorable than Park Aerospace.

Risk & Volatility

Park Aerospace has a beta of 0.46, suggesting that its share price is 54% less volatile than the S&P 500. Comparatively, BWX Technologies has a beta of 0.78, suggesting that its share price is 22% less volatile than the S&P 500.

Summary

BWX Technologies beats Park Aerospace on 14 of the 18 factors compared between the two stocks.

About Park Aerospace

Park Aerospace Corp., an aerospace company, develops and manufactures solution and hot-melt advanced composite materials used to produce composite structures for the aerospace market in North America, Asia, and Europe. It offers advanced composite materials, including film adhesives and lightning strike protection materials that are used to produce primary and secondary structures for jet engines, large and regional transport aircrafts, military aircrafts, unmanned aerial vehicles, business jets, general aviation aircrafts, and rotary wing aircrafts. The company also provides specialty ablative materials for rocket motors and nozzles; and specially designed materials for radome applications. In addition, it designs and fabricates composite parts, structures and assemblies, and low volume tooling for the aerospace industry. The company was formerly known as Park Electrochemical Corp. and changed its name to Park Aerospace Corp. in July 2019. Park Aerospace Corp. was incorporated in 1954 and is based in Westbury, New York.

About BWX Technologies

BWX Technologies, Inc., together with its subsidiaries, manufactures and sells nuclear components in the United States, Canada, and internationally. It operates through two segments, Government Operations and Commercial Operations. The Government Operations segment designs and manufactures naval nuclear components, reactors, and nuclear fuel; fabrication activities; and supplies proprietary and sole-source valves, manifolds, and fittings to naval and commercial shipping customers. This segment also involved in manufacture of close-tolerance and equipment for nuclear applications; down blend government stockpiles of uranium; receives, stores, characterizes, dissolves, recovers, and purifies uranium-bearing materials; and supplies research reactor fuel elements for colleges, universities, and national laboratories, as well as components for defense applications. The Commercial Operations segment designs and manufactures commercial nuclear steam generators, heat exchangers, pressure vessels, and reactor components; and other auxiliary equipment, including containers for the storage of nuclear fuel and other high-level nuclear waste. This segment also offers nuclear fuel, fuel handling systems, tooling delivery systems, nuclear grade materials, and precisely machined components, and related services for CANDU nuclear power plants; provides in-plant inspection, maintenance, and modification services, as well as non-destructive examination and tooling/repair solutions; and manufactures medical radioisotopes, radiopharmaceuticals, and medical devices. The company was formerly known as The Babcock & Wilcox Company and changed its name to BWX Technologies, Inc. in June 2015. BWX Technologies, Inc. was founded in 1867 and is headquartered in Lynchburg, Virginia.