ZKH Group (NYSE:ZKH – Get Free Report) and Willis Lease Finance (NASDAQ:WLFC – Get Free Report) are both small-cap industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, earnings, dividends, profitability, risk, institutional ownership and analyst recommendations.
Analyst Ratings
This is a breakdown of current ratings and price targets for ZKH Group and Willis Lease Finance, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| ZKH Group | 1 | 0 | 0 | 0 | 1.00 |
| Willis Lease Finance | 0 | 2 | 1 | 1 | 2.75 |
Willis Lease Finance has a consensus target price of $75.50, indicating a potential upside of 34.41%. Given Willis Lease Finance’s stronger consensus rating and higher probable upside, analysts clearly believe Willis Lease Finance is more favorable than ZKH Group.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| ZKH Group | $1.29 billion | 0.29 | -$19.44 million | ($0.01) | -291.50 |
| Willis Lease Finance | $730.24 million | 1.63 | $113.76 million | $3.99 | 14.08 |
Willis Lease Finance has lower revenue, but higher earnings than ZKH Group. ZKH Group is trading at a lower price-to-earnings ratio than Willis Lease Finance, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
9.5% of ZKH Group shares are owned by institutional investors. Comparatively, 93.7% of Willis Lease Finance shares are owned by institutional investors. 53.3% of Willis Lease Finance shares are owned by 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 ZKH Group and Willis Lease Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| ZKH Group | -0.02% | -0.06% | -0.03% |
| Willis Lease Finance | 11.80% | 14.11% | 2.64% |
Risk and Volatility
ZKH Group has a beta of 0.39, suggesting that its stock price is 61% less volatile than the S&P 500. Comparatively, Willis Lease Finance has a beta of 0.72, suggesting that its stock price is 28% less volatile than the S&P 500.
Summary
Willis Lease Finance beats ZKH Group on 14 of the 15 factors compared between the two stocks.
About ZKH Group
ZKH Group Limited develops and operates a maintenance, repair, and operating (MRO) products trading and service platform that offers spare parts, chemicals, manufacturing parts, general consumables, and office supplies in the People’s Republic of China. The company provides MRO procurement and management services; digitalized MRO procurement solutions; and logistics and warehousing services. It also engages in the production and sale of intelligent warehousing equipment. ZKH Group Limited was founded in 1998 and is based in Shanghai, the People’s Republic of China.
About Willis Lease Finance
Willis Lease Finance Corporation operates as a lessor and servicer of commercial aircraft and aircraft engines worldwide. The company operates through two segments, Leasing and Related Operations, and Spare Parts Sales. The Leasing and Related Operations segment engages in acquiring and leasing commercial aircraft, aircraft engines, and other aircraft equipment, as well as the purchase and resale of commercial aircraft engines and other aircraft equipment, and other related businesses. The Spare Parts Sales segment purchases and resells after-market engine parts, whole engines, engine modules, and portable aircraft components. The company also focuses on engine management and consulting business. It serves commercial aircraft operators, as well as maintenance, repair, and overhaul organizations. As of December 31, 2023, it had a total lease portfolio of 337 engines, 12 aircraft, one marine vessel, and other leased parts and equipment, and with 74 lessees in 42 countries; and managed a total lease portfolio of 198 engines, aircraft, and related equipment for other parties. The company was founded in 1985 and is headquartered in Coconut Creek, Florida.
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