Contrasting NeoVolta (NASDAQ:NEOV) and Generac (NYSE:GNRC)

Generac (NYSE:GNRC) and NeoVolta (NASDAQ:NEOV) are both industrials companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, analyst recommendations, dividends, risk, earnings, valuation and institutional ownership.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Generac and NeoVolta, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Generac	0	6	12	2	2.80
NeoVolta	1	2	4	0	2.43

Generac presently has a consensus target price of $295.40, suggesting a potential upside of 44.29%. NeoVolta has a consensus target price of $9.50, suggesting a potential upside of 179.41%. Given NeoVolta’s higher probable upside, analysts clearly believe NeoVolta is more favorable than Generac.

Insider & Institutional Ownership

84.0% of Generac shares are held by institutional investors. Comparatively, 5.1% of NeoVolta shares are held by institutional investors. 2.4% of Generac shares are held by company insiders. Comparatively, 4.0% of NeoVolta shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Generac and NeoVolta’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Generac	5.82%	17.83%	8.58%
NeoVolta	-63.35%	-141.89%	-89.61%

Risk and Volatility

Generac has a beta of 1.91, meaning that its stock price is 91% more volatile than the S&P 500. Comparatively, NeoVolta has a beta of -0.87, meaning that its stock price is 187% less volatile than the S&P 500.

Valuation and Earnings

This table compares Generac and NeoVolta”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Generac	$4.21 billion	2.87	$159.55 million	$4.34	47.17
NeoVolta	$8.43 million	22.83	-$5.03 million	($0.33)	-10.30

Generac has higher revenue and earnings than NeoVolta. NeoVolta is trading at a lower price-to-earnings ratio than Generac, indicating that it is currently the more affordable of the two stocks.

Summary

Generac beats NeoVolta on 12 of the 15 factors compared between the two stocks.

About Generac

Generac Holdings Inc. designs, manufactures, and distributes various energy technology products and solution worldwide. The company offers residential automatic standby generators, automatic transfer switch, air-cooled engine residential standby generators, and liquid-cooled engine generators; Mobile Link, a remote monitoring system for home standby generators; residential storage solution, which consists of a system of batteries, an inverter, photovoltaic optimizers, power electronic controls, and other components; smart home solutions, such as smart thermostats and a suite of home monitoring products. It also provides smart home energy management devices and sensors for heating and cooling system; smart doorbell cameras; and portable and inverter generators; multiple portable battery solutions; manual transfer switches; outdoor power equipment, including trimmers, field and brush mowers, log splitters, stump grinders, chipper shredders, lawn and leaf vacuums, and pressure washers and water pumps; and battery-powered turf care products. In addition, the company offers commercial and industrial products comprising cleaner-burning natural gas fueled generators; light-commercial standby generators and related transfer switches; stationary generators; single-engine industrial generators; industrial standby generators; industrial transfer switches; light towers, mobile generators, commercial mobile pumps, heaters, dust-suppression equipment, and mobile energy storage systems; stationary energy storage system and related inverter products; and aftermarket service parts and product accessories. The company distributes its products through independent residential dealers, industrial distributors and dealers, national and regional retailers, e-commerce partners, electrical/HVAC/solar wholesalers, solar installers, catalogs, equipment rental companies, and other equipment distributors; and directly to end users. The company was founded in 1959 and is headquartered in Waukesha, Wisconsin.

About NeoVolta

NeoVolta Inc. designs, manufactures, and sells energy storage systems in the United States. It provides NV14, NV14-K, and NV 24 energy storage systems, which stores and uses energy through batteries and an inverter at residential or commercial sites. The company markets and sells its products directly to certified solar installers and solar equipment distributors. NeoVolta Inc. was formed in 2018 and is headquartered in Poway, California.