Comparing Air France-KLM (OTCMKTS:AFLYY) and Air Canada (OTCMKTS:ACDVF)

Air France-KLM (OTCMKTS:AFLYY) and Air Canada (OTCMKTS:ACDVF) are both mid-cap transportation companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, profitability, risk, earnings, institutional ownership, analyst recommendations and dividends.

Earnings & Valuation

This table compares Air France-KLM and Air Canada’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Air France-KLM $31.15 billion 0.15 $483.03 million $1.06 10.41
Air Canada $13.94 billion 0.60 $128.84 million N/A N/A

Air France-KLM has higher revenue and earnings than Air Canada.

Profitability

This table compares Air France-KLM and Air Canada’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Air France-KLM 1.35% 12.80% 1.02%
Air Canada 5.85% 21.91% 3.94%

Analyst Recommendations

This is a summary of recent ratings and target prices for Air France-KLM and Air Canada, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Air France-KLM 1 6 3 0 2.20
Air Canada 0 1 4 0 2.80

Air France-KLM presently has a consensus price target of $13.00, indicating a potential upside of 17.86%. Air Canada has a consensus price target of $32.00, indicating a potential upside of 1.49%. Given Air France-KLM’s higher possible upside, analysts clearly believe Air France-KLM is more favorable than Air Canada.

Insider & Institutional Ownership

5.3% of Air France-KLM shares are held by institutional investors. Comparatively, 0.1% of Air Canada shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Air Canada beats Air France-KLM on 7 of the 11 factors compared between the two stocks.

About Air France-KLM

Air France-KLM SA, together with its subsidiaries, provides passenger transportation services on scheduled flights. The company operates through Network, Maintenance, Transavia, and Other segments. It also offers cargo transportation and aeronautics maintenance services; and other air-transport-related services. The company operates in France, Benelux, Europe, Africa, the Middle East, Gulf, India, the Asia-Pacific, North America, Caribbean, West Indies, French Guyana, Indian Ocean, and South America. As of December 31, 2018, it operated fleet of 548 aircraft. Air France-KLM SA was founded in 1919 and is headquartered in Paris, France.

About Air Canada

Air Canada provides domestic, U.S. transborder, and international airline services. It offers scheduled passenger services under the Air Canada Vacations and Air Canada Rouge brand name in the Canadian market, the Canada-U.S. transborder market, and in the international market to and from Canada, as well as through capacity purchase agreements on other regional carriers. As of December 31, 2018, the company operated a fleet of 184 aircraft under the Air Canada mainline brand name comprising 91 Boeing and Airbus narrow-body aircraft, 74 Boeing and Airbus wide-body aircraft, and 19 Embraer 190 regional jets; and 53 aircraft under the Air Canada Rouge brand name consisting of 22 Airbus A319 aircraft, 6 Airbus A321 aircraft, and 25 Boeing 767-300 aircraft. It also provides air cargo services in domestic and U.S. transborder routes, as well as on international routes between Canada and markets in Europe, Asia, South America, and Australia. In addition, the company operates, develops, markets, and distributes vacation travel packages in the Caribbean, Mexico, the United States, Europe, Central and South America, South Pacific, Australia, and Asia; and offers cruise packages in North America, Europe, and the Caribbean. Air Canada was founded in 1937 and is based in Saint-Laurent, Canada.

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