Analyzing Aircastle (AYR) and Quest Resource (QRHC)

Aircastle (NYSE: AYR) and Quest Resource (NASDAQ:QRHC) are both small-cap transportation companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, valuation, risk, profitability, institutional ownership and earnings.

Volatility & Risk

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Aircastle has a beta of 1.83, indicating that its stock price is 83% more volatile than the S&P 500. Comparatively, Quest Resource has a beta of 2.79, indicating that its stock price is 179% more volatile than the S&P 500.

Profitability

This table compares Aircastle and Quest Resource’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aircastle 18.56% 8.41% 2.18%
Quest Resource -4.21% -9.10% -6.16%

Institutional & Insider Ownership

61.6% of Aircastle shares are owned by institutional investors. Comparatively, 12.1% of Quest Resource shares are owned by institutional investors. 2.7% of Aircastle shares are owned by company insiders. Comparatively, 50.2% of Quest Resource shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings for Aircastle and Quest Resource, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aircastle 0 9 1 0 2.10
Quest Resource 0 0 1 0 3.00

Aircastle presently has a consensus price target of $24.67, suggesting a potential upside of 24.64%. Quest Resource has a consensus price target of $5.00, suggesting a potential upside of 167.38%. Given Quest Resource’s stronger consensus rating and higher possible upside, analysts clearly believe Quest Resource is more favorable than Aircastle.

Valuation & Earnings

This table compares Aircastle and Quest Resource’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Aircastle $796.62 million 1.95 $147.87 million $1.87 10.58
Quest Resource $138.35 million 0.21 -$5.82 million ($0.38) -4.92

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

Dividends

Aircastle pays an annual dividend of $1.12 per share and has a dividend yield of 5.7%. Quest Resource does not pay a dividend. Aircastle pays out 59.9% of its earnings in the form of a dividend. Aircastle has raised its dividend for 7 consecutive years.

Summary

Aircastle beats Quest Resource on 10 of the 15 factors compared between the two stocks.

Aircastle Company Profile

Aircastle Limited is a holding company. The Company, through its subsidiaries, acquires, leases and sells commercial jet aircrafts to airlines. The Company is engaged in financing and managing commercial flight equipment. The Company manages its aircrafts in the United States, Ireland and Singapore. As of December 31, 2016, the Company owned and managed on behalf of its joint ventures 206 aircrafts leased to 71 lessees located in 36 countries. The Company originates acquisitions and sales through relationships with airlines, other aircraft lessors, financial institutions and brokers, as well as other sources. As of February 7, 2017, the Company had lease commitments or letters of intent to lease or sell 16 aircrafts. The Company’s aircraft portfolio includes passenger wide-body, passenger narrow-body and freighter aircrafts. The Company’s portfolio spans across various regions, such as the Middle East and Africa, South America, North America, Asia and Pacific, and Europe.

Quest Resource Company Profile

Quest Resource Holding Corporation, through its subsidiaries, provides management programs to reuse, recycle, and dispose various waste streams and recyclables in the United States. The company offers recycling and waste management services for motor oil, oil filters, scrap tires, grease and cooking oil, food waste, and expired food products; and various other materials, such as glass, cardboard, paper, and metal, as well as hazardous materials, plastics, construction debris, batteries, mercury, lights, regulated waste, electronic devices, and industrial cleaning products. It also provides landfill diversion services. In addition, the company operates Earth911.com, a Website that offers data, information, and articles in engaging, educating, and entertaining consumers regarding the environment, recycling, and sustainability. Further, it provides sustainability programs, including strategic planning, writing policies and procedures, LEED and green globe certification, life cycle assessment, energy modeling, building commissioning, and carbon emission reduction reporting. Quest Resource Holding Corporation serves big box, food chain, and other retailers; automotive and fleet providers; construction and demolition projects; and commercial, industrial, residential, and educational properties through direct sales force and strategic partnerships. The company was formerly known as Infinity Resources Holdings Corp. and changed its name to Quest Resource Holding Corporation in October 2013. Quest Resource Holding Corporation is based in The Colony, Texas.

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