LATAM Airlines vs United Airlines Which Is a Smarter Choice?

LATAM Airlines and United Airlines are two of the major players in the global aviation industry. Both companies have faced their own set of challenges in recent years, including fluctuating fuel prices, changing consumer preferences, and increased competition. Investors often compare the performance of LATAM and United Airlines stocks to determine which company offers a more attractive investment opportunity. By analyzing key financial metrics, market trends, and industry outlook, investors can make informed decisions about where to allocate their capital in the highly volatile airline sector.

LATAM Airlines or United Airlines?

When comparing LATAM Airlines and United Airlines, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between LATAM Airlines and United Airlines.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. LATAM Airlines has a dividend yield of 1180.4%, while United Airlines has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. LATAM Airlines reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.04%. On the other hand, United Airlines reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with LATAM Airlines P/E ratio at 42.15 and United Airlines's P/E ratio at 11.43. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. LATAM Airlines P/B ratio is 50.48 while United Airlines's P/B ratio is 2.76.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, LATAM Airlines has seen a 5-year revenue growth of -0.98%, while United Airlines's is 0.07%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with LATAM Airlines's ROE at 164.26% and United Airlines's ROE at 27.31%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $0.04 for LATAM Airlines and $95.87 for United Airlines. Over the past year, LATAM Airlines's prices ranged from $0.04 to $1598.00, with a yearly change of 3759900.00%. United Airlines's prices fluctuated between $37.02 and $105.09, with a yearly change of 183.87%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.