JA Solar Holdings, Co. (NASDAQ: JASO) and Sunrun (NASDAQ:RUN) are both small-cap oils/energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, institutional ownership, dividends, profitability, analyst recommendations and earnings.

Profitability

This table compares JA Solar Holdings, Co. and Sunrun’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
JA Solar Holdings, Co. 2.89% 7.90% 2.61%
Sunrun 17.65% 8.76% 2.44%

Earnings and Valuation

This table compares JA Solar Holdings, Co. and Sunrun’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
JA Solar Holdings, Co. N/A N/A N/A $1.56 5.05
Sunrun $474.58 million 1.25 -$59.81 million $0.78 7.17

JA Solar Holdings, Co. has higher revenue, but lower earnings than Sunrun. JA Solar Holdings, Co. is trading at a lower price-to-earnings ratio than Sunrun, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

JA Solar Holdings, Co. has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500. Comparatively, Sunrun has a beta of -0.64, meaning that its share price is 164% less volatile than the S&P 500.

Institutional and Insider Ownership

25.9% of JA Solar Holdings, Co. shares are held by institutional investors. Comparatively, 73.6% of Sunrun shares are held by institutional investors. 24.1% of Sunrun shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for JA Solar Holdings, Co. and Sunrun, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
JA Solar Holdings, Co. 1 2 0 0 1.67
Sunrun 0 2 4 0 2.67

JA Solar Holdings, Co. currently has a consensus price target of $6.33, suggesting a potential downside of 19.63%. Sunrun has a consensus price target of $10.80, suggesting a potential upside of 93.20%. Given Sunrun’s stronger consensus rating and higher probable upside, analysts clearly believe Sunrun is more favorable than JA Solar Holdings, Co..

Summary

Sunrun beats JA Solar Holdings, Co. on 9 of the 12 factors compared between the two stocks.

About JA Solar Holdings, Co.

JA Solar Holdings Co., Ltd. is a holding company. The Company designs, develops, manufactures and sells solar power products that convert sunlight into electricity for a range of uses. The Company is engaged in manufacturing and selling solar modules, as well as silicon wafer manufacturing. The Company operates through two segments, including manufacturing and solar projects. The manufacturing segment includes design, development and manufacture of photovoltaic (PV) products. The solar projects segment includes downstream solar projects, which are involved in electricity generation. The Company’s principal products consist of both monocrystalline and multicrystalline solar cells and solar modules. The Company sells its products primarily under JA Solar brand name, and also produces original equipment for manufacturers or customers. The Company is also engaged in the provision of solar product processing services and project development services.

About Sunrun

Sunrun Inc. is engaged in the design, development, installation, sale, ownership and maintenance of residential solar energy systems (Projects) in the United States. The Company is engaged in providing solar energy services and products to its customers. As of December 31, 2016, it operated a fleet of residential solar energy systems in the United States, with approximately 134,000 customers across 16 states, as well as the District of Columbia. The Company sells to homeowners over the phone, in the field through canvassing and in-home sales and through retail sales channels through its strategic partners. The solar service offerings are provided through its lease and power purchase agreements. It sells solar service offerings and installs solar energy systems for homeowners through its direct-to-consumer channel. It sells solar energy systems to homeowners, as well as related products, such as solar panels, inverters, racking systems and other solar-related equipment to resellers.

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