Head-To-Head Analysis: Lockheed Martin (NYSE:LMT) & GE Aerospace (NYSE:GE)

Lockheed Martin (NYSE:LMT) and GE Aerospace (NYSE:GE) are both large-cap aerospace companies, but which is the better business? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, analyst recommendations, risk, earnings and profitability.

Volatility and Risk

Lockheed Martin has a beta of 0.1, suggesting that its share price is 90% less volatile than the S&P 500. Comparatively, GE Aerospace has a beta of 1.36, suggesting that its share price is 36% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Lockheed Martin and GE Aerospace, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lockheed Martin	1	12	7	1	2.38
GE Aerospace	1	2	16	1	2.85

Lockheed Martin presently has a consensus price target of $620.68, indicating a potential upside of 18.83%. GE Aerospace has a consensus price target of $348.22, indicating a potential upside of 16.03%. Given Lockheed Martin’s higher probable upside, equities research analysts plainly believe Lockheed Martin is more favorable than GE Aerospace.

Valuation & Earnings

This table compares Lockheed Martin and GE Aerospace”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lockheed Martin	$75.05 billion	1.60	$5.02 billion	$20.65	25.29
GE Aerospace	$45.86 billion	6.83	$8.70 billion	$8.12	36.96

GE Aerospace has lower revenue, but higher earnings than Lockheed Martin. Lockheed Martin is trading at a lower price-to-earnings ratio than GE Aerospace, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Lockheed Martin and GE Aerospace’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lockheed Martin	6.38%	101.64%	10.98%
GE Aerospace	17.86%	37.99%	5.61%

Dividends

Lockheed Martin pays an annual dividend of $13.80 per share and has a dividend yield of 2.6%. GE Aerospace pays an annual dividend of $1.88 per share and has a dividend yield of 0.6%. Lockheed Martin pays out 66.8% of its earnings in the form of a dividend. GE Aerospace pays out 23.2% 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. Lockheed Martin has raised its dividend for 22 consecutive years and GE Aerospace has raised its dividend for 2 consecutive years. Lockheed Martin is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

74.2% of Lockheed Martin shares are held by institutional investors. Comparatively, 74.8% of GE Aerospace shares are held by institutional investors. 0.1% of Lockheed Martin shares are held by insiders. Comparatively, 0.2% of GE Aerospace shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

GE Aerospace beats Lockheed Martin on 10 of the 17 factors compared between the two stocks.

About Lockheed Martin

Lockheed Martin Corporation, a security and aerospace company, engages in the research, design, development, manufacture, integration, and sustainment of technology systems, products, and services worldwide. The company operates through Aeronautics, Missiles and Fire Control, Rotary and Mission Systems, and Space segments. The Aeronautics segment offers combat and air mobility aircraft, unmanned air vehicles, and related technologies. The Missiles and Fire Control segment provides air and missile defense systems; tactical missiles and air-to-ground precision strike weapon systems; logistics; fire control systems; mission operations support, readiness, engineering support, and integration services; manned and unmanned ground vehicles; and energy management solutions. The Rotary and Mission Systems segment offers military and commercial helicopters, surface ships, sea and land-based missile defense systems, radar systems, sea and air-based mission and combat systems, command and control mission solutions, cyber solutions, and simulation and training solutions. The Space segment offers satellites; space transportation systems; strategic, advanced strike, and defensive systems; and classified systems and services in support of national security systems. This segment also provides network-enabled situational awareness and integrates space and ground global systems to help its customers gather, analyze, and securely distribute critical intelligence data. It serves primarily serves the U.S. government, as well as foreign military sales contracted through the U.S. government. The company was founded in 1912 and is based in Bethesda, Maryland.

About GE Aerospace

GE Aerospace (also known as General Electric) is a company that specializes in providing aerospace products and services. It operates through two reportable segments: Commercial Engines and Services and Defense and Propulsion Technologies. It offers jet and turboprop engines, as well as integrated systems for commercial, military, business, and general aviation aircraft. GE demerged into GE Vernova, GE Aerospace, and GE Healthcare.