Park Aerospace (NYSE:PKE – Get Free Report) and Mercury Systems (NASDAQ:MRCY – Get Free Report) are both aerospace companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, earnings, valuation and risk.
Institutional & Insider Ownership
77.8% of Park Aerospace shares are held by institutional investors. Comparatively, 96.0% of Mercury Systems shares are held by institutional investors. 11.3% of Park Aerospace shares are held by company insiders. Comparatively, 1.4% of Mercury Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Profitability
This table compares Park Aerospace and Mercury Systems’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Park Aerospace | 15.38% | 10.08% | 9.06% |
| Mercury Systems | -1.46% | 2.22% | 1.32% |
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Park Aerospace | 0 | 0 | 3 | 0 | 3.00 |
| Mercury Systems | 2 | 3 | 3 | 2 | 2.50 |
Park Aerospace presently has a consensus target price of $42.00, suggesting a potential upside of 17.10%. Mercury Systems has a consensus target price of $91.00, suggesting a potential downside of 23.73%. Given Park Aerospace’s stronger consensus rating and higher possible upside, equities analysts clearly believe Park Aerospace is more favorable than Mercury Systems.
Volatility & Risk
Park Aerospace has a beta of 0.42, suggesting that its share price is 58% less volatile than the S&P 500. Comparatively, Mercury Systems has a beta of 0.94, suggesting that its share price is 6% less volatile than the S&P 500.
Valuation and Earnings
This table compares Park Aerospace and Mercury Systems”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 | $73.30 million | 10.22 | $11.27 million | $0.56 | 64.05 |
| Mercury Systems | $912.02 million | 7.86 | -$37.90 million | ($0.24) | -497.17 |
Park Aerospace has higher earnings, but lower revenue than Mercury Systems. Mercury Systems is trading at a lower price-to-earnings ratio than Park Aerospace, indicating that it is currently the more affordable of the two stocks.
Summary
Park Aerospace beats Mercury Systems on 10 of the 14 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 Mercury Systems
Mercury Systems, Inc., a technology company, manufactures and sells components, products, modules, and subsystems for aerospace and defense industries in the United States, Europe, and the Asia Pacific. Its products and solutions are deployed in approximately 300 programs with 25 defense contractors and commercial aviation customers. The company offers components, including power amplifiers and limiters, switches, oscillators, filters, equalizers, digital and analog converters, chips, monolithic microwave integrated circuits, and memory and storage devices; modules and sub-assemblies, such as embedded processing boards, switched fabrics and boards, digital receivers, multi-chip modules, integrated radio frequency and microwave multi-function assemblies, tuners, and transceivers, as well as graphics and video boards; and integrated subsystems. It also designs and develops digital radio frequency memory units for various modern electronic warfare applications; radar environment simulation and test systems for defense and intelligence applications; and signals intelligence payloads and EO/IR technologies for small UAV platforms, as well as onboard UAV processor systems for real-time wide area motion imagery. The company was formerly known as Mercury Computer Systems, Inc. and changed its name to Mercury Systems, Inc. in November 2012. The company was incorporated in 1981 and is headquartered in Andover, Massachusetts.
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