Contrasting Heico (NYSE:HEI) and Optex Systems (NASDAQ:OPXS)

Heico (NYSE:HEI) and Optex Systems (NASDAQ:OPXS) are both aerospace companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, profitability, valuation, risk, institutional ownership and earnings.

Profitability

This table compares Heico and Optex Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Heico	15.38%	16.57%	8.34%
Optex Systems	10.75%	22.12%	17.74%

Risk & Volatility

Heico has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500. Comparatively, Optex Systems has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Heico and Optex Systems, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Heico	0	7	10	0	2.59
Optex Systems	0	1	0	1	3.00

Heico presently has a consensus price target of $358.71, indicating a potential upside of 24.29%. Given Heico’s higher probable upside, analysts clearly believe Heico is more favorable than Optex Systems.

Earnings & Valuation

This table compares Heico and Optex Systems”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Heico	$4.49 billion	8.98	$690.39 million	$5.06	57.04
Optex Systems	$41.34 million	1.96	$5.15 million	$0.66	17.73

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

Insider and Institutional Ownership

27.1% of Heico shares are held by institutional investors. Comparatively, 19.1% of Optex Systems shares are held by institutional investors. 4.9% of Heico shares are held by company insiders. Comparatively, 27.7% of Optex Systems shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Heico beats Optex Systems on 10 of the 15 factors compared between the two stocks.

About Heico

HEICO Corporation, through its subsidiaries, designs, manufactures, and sells aerospace, defense, and electronic related products and services in the United States and internationally. Its Flight Support Group segment provides jet engine and aircraft component replacement parts; thermal insulation blankets and parts; renewable/reusable insulation systems; and specialty components. This segment also distributes hydraulic, pneumatic, structural, interconnect, mechanical, and electro-mechanical components for the commercial, regional, and general aviation markets; and offers repair and overhaul services for jet engine and aircraft component parts, avionics, instruments, composites, and flight surfaces of commercial aircraft, as well as for avionics and navigation systems, and other instruments utilized on military aircraft. The company's Electronic Technologies Group segment provides electro-optical infrared simulation and test equipment; electro-optical laser products; electro-optical, microwave, and other power equipment; electromagnetic and radio frequency (RF) interference shielding and suppression filters; power conversion and interface; interconnection devices; and underwater locator beacons and emergency locator transmission beacons. This segment also offers traveling wave tube amplifiers and microwave power modules; memory products and specialty semiconductors; harsh environment connectivity products and custom molded cable assemblies; RF and microwave products; communications and electronic intercept receivers and tuners; self-sealing auxiliary fuel systems; active antenna systems and airborne antennas; nuclear radiation detectors; silicone products; power amplifiers; ceramic-to-metal feedthroughs and connectors; technical surveillance countermeasures equipment; RF receivers and sources; embedded computing solutions; test sockets and adapters; and radiation assurance services. The company was incorporated in 1957 and is headquartered in Hollywood, Florida.

About Optex Systems

Optex Systems Holdings, Inc manufactures and sells optical sighting systems and assemblies primarily for the U.S. department of defense, foreign military applications, and commercial markets in the United States. It offers periscopes, such as laser and non-laser protected plastic and glass periscopes, electronic M17 day/thermal periscopes, and vision blocks; sighting systems, including back up sights, digital day and night sighting systems, M36 thermal periscope, unity mirrors, optical weapon system support and maintenance, commander weapon station sights, and sight assembly refurbishments; howitzers comprising M137 telescope, M187 mount, M119 aiming device, XM10 and aiming circles; and applied optics center consisting of laser interference filter, optical assemblies, laser filter units, day windows, and specialty thin film coatings, as well as other products, such as muzzle reference systems, binoculars, collimators, optical lenses and elements, and windows. The company also provides various periscope configurations, rifle and surveillance sights, and night vision optical assemblies. Its products are installed on various types of U.S. military land vehicles, such as the Abrams, Bradley, and Stryker families of fighting vehicles, as well as light armored and armored security vehicles. The company offers its products directly to the federal government, prime contractors, and foreign governments. Optex Systems Holdings, Inc was founded in 1987 and is headquartered in Richardson, Texas. Optex Systems Holdings, Inc is a subsidiary of Sileas Corporation.