Financial Comparison: Rolls-Royce Holdings PLC (OTCMKTS:RYCEY) versus CAE (NYSE:CAE)

CAE (NYSE:CAE) and Rolls-Royce Holdings PLC (OTCMKTS:RYCEY) are both aerospace companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, dividends, valuation, institutional ownership, earnings, profitability and risk.

Profitability

This table compares CAE and Rolls-Royce Holdings PLC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CAE	8.70%	7.92%	3.51%
Rolls-Royce Holdings PLC	N/A	N/A	N/A

Earnings and Valuation

This table compares CAE and Rolls-Royce Holdings PLC”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CAE	$4.83 billion	1.72	$291.29 million	$0.97	26.73
Rolls-Royce Holdings PLC	$24.16 billion	5.06	$3.22 billion	N/A	N/A

Rolls-Royce Holdings PLC has higher revenue and earnings than CAE.

Insider and Institutional Ownership

67.4% of CAE shares are owned by institutional investors. Comparatively, 0.1% of Rolls-Royce Holdings PLC shares are owned by institutional investors. 18.3% of CAE shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for CAE and Rolls-Royce Holdings PLC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CAE	0	5	5	2	2.75
Rolls-Royce Holdings PLC	0	3	1	1	2.60

CAE presently has a consensus target price of $34.33, suggesting a potential upside of 32.43%. Given CAE’s stronger consensus rating and higher possible upside, equities analysts plainly believe CAE is more favorable than Rolls-Royce Holdings PLC.

Risk and Volatility

CAE has a beta of 1.42, meaning that its stock price is 42% more volatile than the S&P 500. Comparatively, Rolls-Royce Holdings PLC has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500.

Dividends

CAE pays an annual dividend of $0.33 per share and has a dividend yield of 1.3%. Rolls-Royce Holdings PLC pays an annual dividend of $0.14 per share and has a dividend yield of 1.0%. CAE pays out 33.9% of its earnings in the form of a dividend.

Summary

CAE beats Rolls-Royce Holdings PLC on 11 of the 15 factors compared between the two stocks.

About CAE

CAE Inc., together with its subsidiaries, provides simulation training and critical operations support solutions in Canada, the United States, the United Kingdom, Europe, Asia, the Oceania, Africa, and Rest of the Americas. It operates through two segments, Civil Aviation; and Defense and Security. The Civil Aviation segment offers training solutions for flight, cabin, maintenance, and ground personnel in commercial, business, and helicopter aviation; a range of flight simulation training devices; and ab initio pilot training and crew sourcing services, as well as aircraft flight operations solutions. The Defense and Security segment operates as a training and simulation provider that delivers platform-independent solutions to enable and enhance force readiness and security for defense forces, original equipment manufacturers (OEMs), government agencies, and public safety organizations. The company was formerly known as CAE Industries Ltd. and changed its name to CAE Inc. in 1993. CAE Inc. was incorporated in 1947 and is headquartered in Saint-Laurent, Canada.

About Rolls-Royce Holdings PLC

Rolls-Royce Holdings plc develops and delivers complex power and propulsion solutions for air, sea, and land in the United Kingdom and internationally. The company operates through four segments: Civil Aerospace, Defence, Power Systems, and New Markets. The Civil Aerospace segment develops, manufactures, markets, and sells aero engines for large commercial aircraft, regional jet, and business aviation markets, as well as provides aftermarket services. The Defence segment is involved in the development, manufacture, marketing, and sale of military aero engines, naval engines, and submarine nuclear power plants, as well as offers aftermarket services. The Power Systems segment engages in the development, manufacture, marketing, and sale of integrated solutions for onsite power and propulsion under the mtu brand name. The New Markets segment develops, manufactures, and sells small modular reactor and new electrical power solutions. Rolls-Royce Holdings plc was founded in 1884 and is headquartered in London, the United Kingdom.