Critical Review: JinkoSolar (JKS) & SolarCity (SCTY)
JinkoSolar (NYSE: JKS) and SolarCity (NASDAQ:SCTY) are both oils/energy companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, risk, dividends, institutional ownership, profitability, valuation and analyst recommendations.
This table compares JinkoSolar and SolarCity’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
21.3% of JinkoSolar shares are held by institutional investors. Comparatively, 40.0% of SolarCity shares are held by institutional investors. 36.4% of SolarCity shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Earnings & Valuation
This table compares JinkoSolar and SolarCity’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|JinkoSolar||$3.08 billion||0.26||$263.10 million||$5.02||4.90|
JinkoSolar has higher revenue and earnings than SolarCity. SolarCity is trading at a lower price-to-earnings ratio than JinkoSolar, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and price targets for JinkoSolar and SolarCity, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
JinkoSolar currently has a consensus price target of $17.40, indicating a potential downside of 29.24%. Given JinkoSolar’s higher probable upside, equities research analysts plainly believe JinkoSolar is more favorable than SolarCity.
JinkoSolar beats SolarCity on 5 of the 8 factors compared between the two stocks.
JinkoSolar Holding Co., Ltd. operates in the photovoltaic (PV) industry. The Company has built a vertically integrated solar power product value chain, from recovering silicon materials to manufacturing solar modules and solar power generation. The Company’s segments include the manufacturing segment and the solar power projects segment. The manufacturing segment comprises its vertically integrated solar power product manufacturing business, under which the Company manufactures silicon ingots, wafers, cells and solar modules. The solar power projects segment comprises the downstream solar power generation, construction and operation business, including power generation; engineering, procurement and construction (EPC), and connecting solar power projects to the grid, and operation and maintenance (O&M) of the solar power projects. The Company sells its solar modules under the JinkoSolar brand. Its services include solar system EPC and processing services.
SolarCity Corporation is a United States-based solar provider. The Company is primarily engaged in the design, manufacture, installation and sale or lease of solar energy systems to residential and commercial customers, or sale of electricity generated by solar energy systems to customers. It operates through solar energy products and services segment. It integrates the sales, engineering, manufacturing, installation, monitoring, maintenance and financing of its distributed solar energy systems. It offers its customers the option to either purchase and own solar energy systems or to purchase the energy that its solar energy systems produce through various contractual arrangements. It installs solar energy system at its customer’s premises and charge the customer a monthly fee for the power that its system produces. Its products, services and technologies include solar energy systems, customer agreements, grid control/energy storage systems, Zep Solar mounting systems and software.
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