Continental (OTCMKTS:CTTAY) and REE Automotive (NASDAQ:REE) Financial Analysis

Continental (OTCMKTS:CTTAY) and REE Automotive (NASDAQ:REE) are both auto/tires/trucks companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, profitability, risk, institutional ownership and earnings.

Analyst Ratings

This is a summary of current recommendations and price targets for Continental and REE Automotive, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Continental	0	6	3	0	2.33
REE Automotive	1	2	1	0	2.00

REE Automotive has a consensus target price of $4.75, suggesting a potential upside of 809.09%. Given REE Automotive’s higher probable upside, analysts plainly believe REE Automotive is more favorable than Continental.

Insider and Institutional Ownership

0.0% of Continental shares are held by institutional investors. Comparatively, 12.7% of REE Automotive shares are held by institutional investors. 6.0% of REE Automotive shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Continental and REE Automotive”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Continental	$22.26 billion	0.60	-$186.64 million	$0.16	41.44
REE Automotive	$180,000.00	64.62	-$111.75 million	($7.19)	-0.07

REE Automotive has lower revenue, but higher earnings than Continental. REE Automotive is trading at a lower price-to-earnings ratio than Continental, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Continental and REE Automotive’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Continental	0.91%	1.14%	0.34%
REE Automotive	N/A	N/A	N/A

Risk & Volatility

Continental has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500. Comparatively, REE Automotive has a beta of 2.72, indicating that its stock price is 172% more volatile than the S&P 500.

Summary

Continental beats REE Automotive on 8 of the 14 factors compared between the two stocks.

About Continental

Continental Aktiengesellschaft, a technology company, offers intelligent solutions for vehicles, machines, traffic, and transportation worldwide. It operates through four sectors: Automotive, Tires, ContiTech, and Contract Manufacturing. The company offers safety, brake, chassis, motion, and motion control systems; solutions for assisted and automated driving; display and operating technologies; and audio and camera solutions for the vehicle interior, as well as intelligent information and communication technology solutions. It also provides tires for cars, trucks, buses, two-wheel, and specialist vehicles, as well as digital tire monitoring and management systems; and engages in retail of tires. In addition, the company develops products and systems made from rubber, plastic, metal and textiles for the energy, agriculture, and construction, as well as interior design, automotive, transportation, and railway engineering sectors; and provides contract manufacturing services. The company was formerly known as Continental-Caoutchouc- und Gutta-Percha Compagnie. Continental Aktiengesellschaft was founded in 1871 and is headquartered in Hanover, Germany.

About REE Automotive

REE Automotive Ltd. operates as an automotive technology company in France, the United Kingdom, the United States, and internationally. The company offers REEcorner, a compact module that integrates critical vehicle drive components comprising as steering, braking, suspension, powertrain, and control between the chassis and the wheel; and REEplatform that allows for the addition of a modular and customizable top hat/cabin design based on customer specifications, without requiring modification to the platform. It also provides P7-S Strip Chassis for commercial delivery vehicles and walk-in vans; P7-C Chassis Cab and Cutway Chassis, a class 4 chassis cab fully electric commercial truck for delivery and a range of vocational applications; and P7-B Box Truck, a class 3 box truck built on a P7 cab chassis with its all-wheel drive and all-wheel steer for vehicle control for better handling and safety in adverse conditions. It serves original equipment manufacturer, delivery and logistic fleets, dealers, e-commerce retailers, new mobility players, mobility-as-a-service providers, and autonomous drive companies. The company is headquartered in Herzliya, Israel.