Alaska Air Group (NYSE:ALK) versus Air France-KLM (OTC:AFLYY) Critical Comparison

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

Valuation and Earnings

This table compares Alaska Air Group and Air France-KLM”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alaska Air Group	$11.74 billion	0.79	$395.00 million	$3.05	24.71
Air France-KLM	$32.49 billion	0.07	$1.01 billion	$0.10	8.54

Air France-KLM has higher revenue and earnings than Alaska Air Group. Air France-KLM is trading at a lower price-to-earnings ratio than Alaska Air Group, indicating that it is currently the more affordable of the two stocks.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Alaska Air Group	3.37%	14.66%	3.60%
Air France-KLM	0.39%	19.62%	0.34%

Analyst Recommendations

This is a summary of current ratings and target prices for Alaska Air Group and Air France-KLM, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alaska Air Group	0	0	13	0	3.00
Air France-KLM	0	1	0	0	2.00

Alaska Air Group presently has a consensus target price of $76.69, suggesting a potential upside of 1.78%. Given Alaska Air Group’s stronger consensus rating and higher probable upside, equities analysts clearly believe Alaska Air Group is more favorable than Air France-KLM.

Volatility & Risk

Alaska Air Group has a beta of 1.55, meaning that its share price is 55% more volatile than the S&P 500. Comparatively, Air France-KLM has a beta of 1.61, meaning that its share price is 61% more volatile than the S&P 500.

Insider and Institutional Ownership

81.9% of Alaska Air Group shares are owned by institutional investors. Comparatively, 0.9% of Air France-KLM shares are owned by institutional investors. 0.7% of Alaska Air Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Summary

Alaska Air Group beats Air France-KLM on 10 of the 14 factors compared between the two stocks.

About Alaska Air Group

Alaska Air Group, Inc., through its subsidiaries, operates airlines. It operates through three segments: Mainline, Regional, and Horizon. The company offers scheduled air transportation services on Boeing jet aircraft for passengers and cargo in the United States, and in parts of Canada, Mexico, Costa Rica, Belize, Guatemala, and the Bahamas; and for passengers across a shorter distance network within the United States, Canada, and Mexico. Alaska Air Group, Inc. was founded in 1932 and is based in Seattle, Washington.

About Air France-KLM

AIR FRANCE-KLM is an airline company. The Company’s core business is passenger transport, cargo transport, and aircraft maintenance services. The Group is the world leader in terms of international passenger traffic; and its cargo activity (not including integrators) and is one of the world’s major maintenance service providers. The Group structure is simple: a holding company with two airline subsidiaries. Air France-KLM has established a set of clearly defined commitments to ensure that its strategy of profitable growth goes hand in hand with environmental quality and social progress.