AAR Corp. (AIR) vs Karman Holdings Inc. (KRMN)

AAR Corp. and Karman Holdings Inc. are both Aerospace & Defense companies. Karman Holdings Inc. is the larger, with a market value of $4.5B against $3.9B — 1.1× the size. AAR Corp. trades at the lower P/E: 20.1× against 120×. Karman Holdings Inc. grew revenue faster over the last twelve months: 50.2% against 22.0%. Karman Holdings Inc. has the higher net margin (6.31% vs 5.55%) and the lower return on invested capital (5.09% vs 7.10%). Across the 19 metrics below, AAR Corp. leads on 14 and Karman Holdings Inc. on 5.

Valuation

Metric AIR KRMN Aerospace & Defense median
P/E 20.08 119.59 31.81
P/S 1.12 7.80 3.55
P/B 2.25 10.91 2.59
Price to free cash flow 21.18 n/m 31.99
EV/EBITDA 12.81 34.57 18.08
EV/Sales 1.34 9.15 3.37
Earnings yield 4.98% 0.84% 1.38%
Free cash flow yield 4.72% (0.59%) 0.21%

Profitability

Metric AIR KRMN Aerospace & Defense median
Gross margin 19.06% 41.67% 25.48%
Operating margin 8.17% 16.82% 4.54%
Net margin 5.55% 6.31% 2.22%
Free cash flow margin 5.30% (4.63%) 1.43%
Return on equity 12.93% 9.50% 6.43%
Return on assets 6.09% 3.10% 2.70%
Return on invested capital 7.10% 5.09% 1.56%

Growth

Metric AIR KRMN Aerospace & Defense median
Revenue growth (TTM) 21.97% 50.23% 18.43%
EPS growth (last fiscal year) 1,288.57% 62.50% 24.27%
Revenue growth, 5-year CAGR 14.89% — 9.73%
Net income growth, 5-year CAGR 39.60% — 0.00%

Health

Metric AIR KRMN Aerospace & Defense median
Debt to equity 0.50 2.01 0.24
Current ratio 2.83 3.56 2.72
Net debt to EBITDA 2.23 4.60 1.12

Dividend

Metric AIR KRMN Aerospace & Defense median
Dividend yield — — 0.90%
Payout ratio — — 0.32

Size

Metric AIR KRMN Aerospace & Defense median
Market cap 3.94b 4.49b 2.19b

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