Loar (NYSE:LOAR – Get Free Report) and VSE (NASDAQ:VSEC – Get Free Report) are both mid-cap industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, dividends, earnings, profitability, valuation, institutional ownership and analyst recommendations.
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Loar and VSE, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Loar | 0 | 3 | 4 | 0 | 2.57 |
| VSE | 0 | 3 | 8 | 1 | 2.83 |
Loar currently has a consensus price target of $88.00, suggesting a potential upside of 15.80%. VSE has a consensus price target of $252.22, suggesting a potential upside of 8.92%. Given Loar’s higher possible upside, equities research analysts clearly believe Loar is more favorable than VSE.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Loar | 11.60% | 9.37% | 5.39% |
| VSE | 6.17% | 6.71% | 4.76% |
Earnings & Valuation
This table compares Loar and VSE”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Loar | $496.28 million | 14.35 | $72.15 million | $0.72 | 105.54 |
| VSE | $1.36 billion | 4.79 | $11.70 million | $3.12 | 74.22 |
Loar has higher earnings, but lower revenue than VSE. VSE is trading at a lower price-to-earnings ratio than Loar, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Loar has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, VSE has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500.
Insider & Institutional Ownership
91.5% of VSE shares are owned by institutional investors. 20.1% of Loar shares are owned by insiders. Comparatively, 1.8% of VSE shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Summary
Loar beats VSE on 8 of the 15 factors compared between the two stocks.
About Loar
Loar Holdings Inc., through its subsidiaries, designs, manufactures, and markets aerospace and defense components for aircraft, and aerospace and defense systems in the United States and internationally. It offers products in various categories, which include airframe components, structural components, avionics, composites, braking system components, de-ice and ice protection, electro-mechanical, engineered materials, flight controls, fluid and motion controls, environmental, metal forming, molded components, and restraints and safety devices. The company also provides auto throttles, lap-belt airbags, two-and three-point seat belts, water purification systems, fire barriers, polyimide washers and bushings, latches, hold-open and tie rods, temperature and fluid sensors and switches, carbon and metallic brake discs, fluid and pneumatic-based ice protection, RAM air components, sealing solutions, actuation devices, and others. It primarily serves commercial, business jet and general aviation, and defense markets. Loar Holdings Inc. was founded in 2017 and is headquartered in White Plains, New York.
About VSE
VSE Corporation operates as a diversified aftermarket products and services company in the United States. The company operates through two segments, Aviation and Fleet. The Aviation segment provides aftermarket parts supply and distribution; maintenance, repair, and overhaul services for components and engine accessories supporting commercial, business, and general aviation operators. This segment serves commercial airlines, regional airlines, cargo transporters, MRO integrators and providers, aviation manufacturers, corporate and private aircraft owners, and fixed-base operators. The Fleet segment offers parts supply, inventory management, e-commerce fulfillment, logistics, supply chain support, and other services to support the commercial aftermarket medium- and heavy-duty truck market. This segment also provides sale of vehicle parts and supply chain services to support client truck fleets, as well as sustainment solutions and managed inventory services to government and commercial truck fleets. VSE Corporation was incorporated in 1959 and is headquartered in Alexandria, Virginia.
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