Head to Head Contrast: TAT Technologies (NASDAQ:TATT) vs. Hexcel (NYSE:HXL)

TAT Technologies (NASDAQ:TATT) and Hexcel (NYSE:HXL) are both aerospace companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, institutional ownership, earnings, valuation, risk and analyst recommendations.

Insider & Institutional Ownership

15.1% of TAT Technologies shares are held by institutional investors. Comparatively, 95.5% of Hexcel shares are held by institutional investors. 8.8% of TAT Technologies shares are held by company insiders. Comparatively, 2.0% of Hexcel shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares TAT Technologies and Hexcel’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TAT Technologies	9.08%	11.10%	8.12%
Hexcel	3.67%	9.25%	5.15%

Risk and Volatility

TAT Technologies has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500. Comparatively, Hexcel has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for TAT Technologies and Hexcel, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TAT Technologies	1	0	6	0	2.71
Hexcel	2	8	3	0	2.08

TAT Technologies presently has a consensus price target of $47.80, indicating a potential upside of 21.10%. Hexcel has a consensus price target of $73.33, indicating a potential upside of 0.23%. Given TAT Technologies’ stronger consensus rating and higher probable upside, research analysts clearly believe TAT Technologies is more favorable than Hexcel.

Earnings & Valuation

This table compares TAT Technologies and Hexcel”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TAT Technologies	$152.12 million	3.26	$11.17 million	$1.33	29.68
Hexcel	$1.90 billion	3.06	$132.10 million	$0.85	86.08

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

Summary

TAT Technologies beats Hexcel on 9 of the 14 factors compared between the two stocks.

About TAT Technologies

TAT Technologies Ltd., together with its subsidiaries, provides solutions and services to the commercial and military aerospace, and ground defense industries in the United States, Israel, and internationally. The company operates through four segments: Original Equipment Manufacturing (OEM) of Heat Transfer Solutions and Aviation Accessories; Maintenance, Repair, and Overhaul (MRO) Services for Heat Transfer Components and OEM of Heat Transfer Solutions; MRO Services for Aviation Components; and Overhaul and Coating of Jet Engine Components. It designs, develops, and manufactures a range of heat transfer solutions, such as pre-cooler and oil/fuel hydraulic heat exchangers used in mechanical and electronic systems in commercial, military, and business aircraft; environmental control and power electronics cooling systems for use in aircraft and ground applications; and a range of other mechanical aircraft accessories and systems, such as pumps, valves, and turbine power units. The company provides MRO services for heat transfer components, as well as for manufacturing heat transfer solutions; and aviation components. In addition, it engages in the operation of a repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers, and the military; and the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes, and afterburner flaps. The company was formerly known as Galagraph Ltd. and changed its name to TAT Technologies Ltd. in May 1992. TAT Technologies Ltd. was founded in 1969 and is headquartered in Netanya, Israel.

About Hexcel

Hexcel Corporation develops, manufactures, and markets carbon fibers, structural reinforcements, honeycomb structures, resins, and composite materials and parts for use in commercial aerospace, space and defense, and industrial applications. It operates through two segments, Composite Materials and Engineered Products. The Composite Materials segment manufactures and markets fabrics, multi-axials, specialty reinforcements, prepregs and other fiber-reinforced matrix materials, structural adhesives, molding compounds, tooling materials, polyurethane systems, and laminates that are used in military and commercial aircraft, wind turbine blades, recreational products, and other industrial applications, as well as in automotive, marine, and rail transportation. The Engineered Products segment manufactures and markets aircraft structures and finished aircraft components, including wing to body fairings, wing panels, flight deck panels, door liners, rotorcraft blades, spars, and tip caps; and aircraft structural sub-components and semi-finished components used in rotorcraft blades, engine nacelles, and aircraft surfaces, such as flaps, wings, elevators, and fairings; and RF interference control products for military and aerospace applications. This segment also provides interference control materials, structural composites, and services; dielectric absorber foams; magnetic absorbers; and thermoplastics for commercial and defense applications. The company sells its products directly through its managers, product managers, and sales personnel, as well as through independent distributors in the Americas, Europe, the Asia Pacific, India, and Africa. Hexcel Corporation was founded in 1946 and is headquartered in Stamford, Connecticut.