Reviewing Ducommun (DCO) & Rockwell Collins (COL)

Ducommun (NYSE: DCO) and Rockwell Collins (NYSE:COL) are both aerospace companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, institutional ownership, valuation, risk and profitability.

Risk and Volatility

Ducommun has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500. Comparatively, Rockwell Collins has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500.

Institutional & Insider Ownership

82.5% of Ducommun shares are owned by institutional investors. Comparatively, 67.6% of Rockwell Collins shares are owned by institutional investors. 8.2% of Ducommun shares are owned by insiders. Comparatively, 1.1% of Rockwell Collins shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Ducommun and Rockwell Collins’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ducommun 3.60% 6.82% 2.75%
Rockwell Collins 10.99% 19.58% 6.43%

Dividends

Rockwell Collins pays an annual dividend of $1.32 per share and has a dividend yield of 1.0%. Ducommun does not pay a dividend. Rockwell Collins pays out 21.5% of its earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Ducommun and Rockwell Collins, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ducommun 0 1 3 0 2.75
Rockwell Collins 1 16 3 0 2.10

Ducommun currently has a consensus target price of $37.00, indicating a potential upside of 17.91%. Rockwell Collins has a consensus target price of $130.00, indicating a potential downside of 2.29%. Given Ducommun’s stronger consensus rating and higher probable upside, equities analysts clearly believe Ducommun is more favorable than Rockwell Collins.

Valuation and Earnings

This table compares Ducommun and Rockwell Collins’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ducommun $558.18 million 0.64 $20.07 million $1.33 23.59
Rockwell Collins $6.82 billion 3.20 $705.00 million $6.15 21.63

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

Summary

Rockwell Collins beats Ducommun on 9 of the 15 factors compared between the two stocks.

Ducommun Company Profile

Ducommun Incorporated provides engineering and manufacturing products and services primarily to the aerospace, defense, industrial, natural resources, medical, and other industries in the United States. The company operates through two segments, Electronic Systems and Structural Systems. The Electronic Systems segment offers cable assemblies and interconnect systems; printed circuit board assemblies; high-level electronic, electromechanical, and mechanical components and assemblies, as well as lightning diversion systems; and radar enclosures, aircraft avionics racks, shipboard communications and control enclosures, wire harnesses, surge suppressors, conformal shields, and other assemblies. It also supplies engineered products, including illuminated pushbutton switches and panels for aviation and test systems; microwave and millimeter switches and filters for radio frequency systems and test instrumentation; and motors and resolvers for motion control. In addition, this segment provides engineering expertise for aerospace system design, development, integration, and testing. The Structural Systems segment designs, engineers, and manufactures contoured aluminum, titanium, and Inconel aero structure components; structural assembly products, such as winglets, engine components, and fuselage structural panels; and metal and composite bonded structures and assemblies comprising aircraft wing spoilers, large fuselage skins, rotor blades on rotary-wing aircraft and components, flight control surfaces, and engine components. The company serves commercial and military fixed-wing and rotary-wing aircraft, and space programs, as well as the industrial automation, medical, and other end-use markets. Ducommun Incorporated was founded in 1849 and is headquartered in Santa Ana, California.

Rockwell Collins Company Profile

Rockwell Collins, Inc. designs, produces, and supports communications and aviation systems worldwide. The company's Interior Systems segment offers commercial aircraft seats; galley structures, food and beverage preparation equipment, and water and waste systems; oxygen and passenger service equipment; cabin lighting systems; and business jet and general aviation interior products. Its Commercial Systems segment provides cabin management systems; data link, frequency, very high frequency, and satellite communications systems; landing, radio navigation, and geophysical sensors, and flight management systems; situational awareness and surveillance systems and products; integrated flight controls; simulation and training systems; maintenance, repair, parts, and after-sales support services, and aftermarket used equipment. The company's Government Systems segment provides communications systems and products; radio navigation products, global positioning system equipment, and multi-mode receivers; avionics systems; precision targeting, electronic warfare, and training systems; simulation and training systems; space wheels; visual system products; maintenance, repair, parts, and after-sales support services, and aftermarket used equipment. Its Information Management Services segment offers voice and data communication services; flight support services; airport communications and information systems; train dispatching and information systems; mission critical security systems; and cabin connectivity solutions. The company serves original equipment manufacturers of commercial air transport, business and regional aircraft, commercial airlines, U.S. Department of Defense, other ministries of defense, other government agencies, defense contractors, the U.S. Federal Aviation Administration, and passenger and freight railroads, as well as airport, critical infrastructure, and business aircraft operators. The company was founded in 1933 and is headquartered in Cedar Rapids, Iowa.

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