Leonardo DRS (NASDAQ:DRS) vs. Woodward (NASDAQ:WWD) Head to Head Contrast

Leonardo DRS (NASDAQ:DRS) and Woodward (NASDAQ:WWD) are both large-cap aerospace companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, institutional ownership, profitability, analyst recommendations and dividends.

Risk and Volatility

Leonardo DRS has a beta of 0.63, suggesting that its stock price is 37% less volatile than the S&P 500. Comparatively, Woodward has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.

Valuation and Earnings

This table compares Leonardo DRS and Woodward”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Leonardo DRS	$3.23 billion	3.98	$213.00 million	$0.87	55.55
Woodward	$3.32 billion	4.60	$372.97 million	$6.19	41.59

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

Dividends

Leonardo DRS pays an annual dividend of $0.36 per share and has a dividend yield of 0.7%. Woodward pays an annual dividend of $1.12 per share and has a dividend yield of 0.4%. Leonardo DRS pays out 41.4% of its earnings in the form of a dividend. Woodward pays out 18.1% 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. Woodward has increased its dividend for 5 consecutive years.

Insider and Institutional Ownership

18.8% of Leonardo DRS shares are owned by institutional investors. Comparatively, 81.2% of Woodward shares are owned by institutional investors. 0.3% of Leonardo DRS shares are owned by insiders. Comparatively, 0.8% of Woodward shares are owned by 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.

Analyst Ratings

This is a summary of current ratings for Leonardo DRS and Woodward, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Leonardo DRS	0	2	5	0	2.71
Woodward	0	3	5	0	2.63

Leonardo DRS presently has a consensus target price of $45.86, indicating a potential downside of 5.12%. Woodward has a consensus target price of $232.25, indicating a potential downside of 9.78%. Given Leonardo DRS’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Leonardo DRS is more favorable than Woodward.

Profitability

This table compares Leonardo DRS and Woodward’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Leonardo DRS	7.00%	10.63%	6.67%
Woodward	11.36%	16.86%	8.58%

Summary

Woodward beats Leonardo DRS on 12 of the 16 factors compared between the two stocks.

About Leonardo DRS

Leonardo DRS, Inc., together with its subsidiaries, provides defense electronic products and systems, and military support services. It operates through Advanced Sensing and Computing (ASC) segment, and Integrated Mission Systems (IMS) segments. The ASC segment designs, develops, and manufacture sensing and network computing technology that enables real-time situational awareness required for enhanced operational decision making and execution; and offers sensing capabilities span applications, such as missions requiring advanced detection, precision targeting and surveillance sensing, long range electro-optic/infrared, signals intelligence, and other intelligence systems including electronic warfare, ground vehicle sensing, active electronically scanned array tactical radars, dismounted soldier, and space sensing. This segment also provides network computing, which are utilized across a range of mission applications including platform computing on ground and shipboard for advanced battle management, combat systems, radar, command and control, tactical networks, tactical computing, and communications. The IMS segment designs, develops, manufacture, and integrates power conversion, control, and distribution systems, ship propulsion systems, motors and variable frequency drives, force protection systems, transportation, and logistics systems for the U.S. and allied defense customers. This segment also offers electrical propulsion systems, which includes power conversion, control, distribution, and propulsion systems, as well as power dense permanent magnet motors, energy storage systems and associated efficient, rugged, and compact power conversion, electrical actuation systems, as well as cooling technologies; and motor controllers, instrumentation and control equipment, electrical actuation systems, and thermal management systems. The company was incorporated in 1968 and is based in Arlington, Virginia. Leonardo DRS, Inc. operates as a subsidiary of Leonardo S.p.A.

About Woodward

Woodward, Inc. designs, manufactures, and services control solutions for the aerospace and industrial markets worldwide. The company operates in two segments, Aerospace and Industrial. The Aerospace segment provides fuel pumps, metering units, actuators, air valves, specialty valves, fuel nozzles, and thrust reverser actuation systems for turbine engines and nacelles, and flight deck controls, actuators, servocontrols, motors, and sensors for aircraft. These products are used on commercial and private aircraft and rotorcraft, as well as on military fixed-wing aircraft and rotorcraft, guided weapons, and other defense systems. It also provides aftermarket maintenance, repair and overhaul, and other services to commercial airlines, repair facilities, military depots, third party repair shops, and other end users. This segment sells its products to original equipment manufacturers (OEMs), tier-one suppliers, and contractors, as well as through aftermarket sales of components, such as provisioning spares and replacements. The Industrial segment offers actuators, valves, pumps, fuel injection systems, solenoids, ignition systems, speed controls, electronics and software, and sensors. These products are used on industrial gas turbines, steam turbines, compressors, and reciprocating engines. This segment sells its aftermarket products, and other related services to OEMs through an independent network of distributors, as well as directly to end users. The company was founded in 1870 and is headquartered in Fort Collins, Colorado.