UNITED vs Air France-KLM Which Is a Smarter Choice?

United Airlines (UAL) and Air France-KLM Group (AF) are two major players in the global aviation industry. Both companies offer a range of services for passengers and cargo, operating a vast network of routes across the world. When comparing their stocks, investors need to consider factors such as market performance, financial health, and strategic partnerships. Understanding the strengths and weaknesses of each company can help investors make informed decisions about where to place their money in the competitive aviation sector.

UNITED or Air France-KLM?

When comparing UNITED and Air France-KLM, 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 UNITED and Air France-KLM.

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. UNITED has a dividend yield of 3.08%, while Air France-KLM has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. UNITED reports a 5-year dividend growth of 6.43% year and a payout ratio of 0.00%. On the other hand, Air France-KLM reports a 5-year dividend growth of 0.00% year and a payout ratio of 54.03%.

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 UNITED P/E ratio at 49.96 and Air France-KLM's P/E ratio at 1.82. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. UNITED P/B ratio is 1.37 while Air France-KLM's P/B ratio is -0.13.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, UNITED has seen a 5-year revenue growth of -0.46%, while Air France-KLM's is -0.77%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with UNITED's ROE at 2.56% and Air France-KLM's ROE at -5.17%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ¥776.00 for UNITED and $0.79 for Air France-KLM. Over the past year, UNITED's prices ranged from ¥670.00 to ¥953.00, with a yearly change of 42.24%. Air France-KLM's prices fluctuated between $0.75 and $1.65, with a yearly change of 120.00%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.