Virgin Galactic (NYSE:SPCE) and Airbus (OTCMKTS:EADSY) Critical Survey

Airbus (OTCMKTS:EADSY) and Virgin Galactic (NYSE:SPCE) are both aerospace companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Institutional & Insider Ownership

0.3% of Airbus shares are held by institutional investors. Comparatively, 46.6% of Virgin Galactic shares are held by institutional investors. 0.3% of Virgin Galactic 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 Airbus and Virgin Galactic’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Airbus	7.15%	23.20%	4.10%
Virgin Galactic	-17,615.71%	-108.00%	-32.35%

Earnings and Valuation

This table compares Airbus and Virgin Galactic”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Airbus	$83.05 billion	2.06	$5.91 billion	$1.89	28.66
Virgin Galactic	$7.04 million	26.54	-$346.74 million	($7.47)	-0.34

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

Analyst Recommendations

This is a summary of recent ratings and target prices for Airbus and Virgin Galactic, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Airbus	0	6	4	0	2.40
Virgin Galactic	2	3	1	0	1.83

Virgin Galactic has a consensus target price of $4.20, suggesting a potential upside of 64.38%. Given Virgin Galactic’s higher probable upside, analysts plainly believe Virgin Galactic is more favorable than Airbus.

Volatility & Risk

Airbus has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500. Comparatively, Virgin Galactic has a beta of 2.21, meaning that its share price is 121% more volatile than the S&P 500.

Summary

Airbus beats Virgin Galactic on 9 of the 14 factors compared between the two stocks.

About Airbus

Airbus SE, together with its subsidiaries, engages in the design, manufacture, and delivery of aerospace products, services, and solutions worldwide. It operates through three segments: Airbus, Airbus Helicopters, and Airbus Defence and Space. The Airbus segment develops, manufactures, markets, and sells commercial jet passenger aircraft, freighter aircraft, regional turboprop aircraft, and aircraft components, as well as provides aircraft conversion and related services. The Airbus Helicopters segment develops, manufactures, markets, and sells civil and military helicopters; and provides helicopter-related services. The Airbus Defence and Space segment designs, develops, delivers, and supports military air systems and related services. This segment also offers civil and defence space systems for telecommunications, earth observations, navigation, and science and orbital systems; missile and space launcher systems; and services around data processing from platforms, secure communication, and cyber security. The company was formerly known as Airbus Group SE and changed its name to Airbus SE in April 2017. Airbus SE was incorporated in 1998 and is headquartered in Leiden, the Netherlands.

About Virgin Galactic

Virgin Galactic Holdings, Inc., an aerospace and space travel company, focuses on the development, manufacture, and operation of spaceships and related technologies. The company engages in the design and development, manufacturing, ground and flight testing, spaceflight operation, and post-flight maintenance of spaceflight systems for private individuals, researchers, and government agencies. Virgin Galactic Holdings, Inc. is headquartered in Tustin, California.