Reviewing ESS Tech (NYSE:GWH) & GrafTech International (NYSE:EAF)

GrafTech International (NYSE:EAF) and ESS Tech (NYSE:GWH) are both small-cap industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.

Analyst Recommendations

This is a summary of recent recommendations and price targets for GrafTech International and ESS Tech, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GrafTech International	3	3	0	0	1.50
ESS Tech	1	1	1	0	2.00

GrafTech International presently has a consensus target price of $10.67, suggesting a potential upside of 31.64%. ESS Tech has a consensus target price of $2.00, suggesting a potential upside of 211.04%. Given ESS Tech’s stronger consensus rating and higher possible upside, analysts plainly believe ESS Tech is more favorable than GrafTech International.

Institutional & Insider Ownership

92.8% of GrafTech International shares are owned by institutional investors. Comparatively, 46.8% of ESS Tech shares are owned by institutional investors. 1.2% of GrafTech International shares are owned by insiders. Comparatively, 1.4% of ESS Tech shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

GrafTech International has a beta of 1.83, indicating that its share price is 83% more volatile than the S&P 500. Comparatively, ESS Tech has a beta of 1.41, indicating that its share price is 41% more volatile than the S&P 500.

Profitability

This table compares GrafTech International and ESS Tech’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GrafTech International	-34.58%	N/A	-17.50%
ESS Tech	N/A	-1,251.69%	-139.79%

Earnings & Valuation

This table compares GrafTech International and ESS Tech”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GrafTech International	$504.13 million	0.42	-$219.84 million	($6.80)	-1.19
ESS Tech	$1.58 million	11.96	-$63.44 million	($3.37)	-0.19

ESS Tech has lower revenue, but higher earnings than GrafTech International. GrafTech International is trading at a lower price-to-earnings ratio than ESS Tech, indicating that it is currently the more affordable of the two stocks.

Summary

ESS Tech beats GrafTech International on 9 of the 14 factors compared between the two stocks.

About GrafTech International

GrafTech International Ltd. research, develops, manufactures, and sells graphite and carbon-based solutions worldwide. The company offers graphite electrodes to produce electric arc furnace steel and other ferrous and non-ferrous metals; and petroleum needle coke, a crystalline form of carbon used in the production of graphite electrodes and synthetic graphite. It sells its products primarily through direct sales force, independent sales representatives, and distributors. GrafTech International Ltd. was founded in 1886 and is headquartered in Brooklyn Heights, Ohio.

About ESS Tech

ESS Tech, Inc., an energy storage company, designs and produces iron flow batteries for commercial and utility-scale energy storage applications worldwide. It offers energy storage products, which include Energy Warehouse, a behind-the-meter solution; and Energy Center, a front-of-the-meter solution. The company was founded in 2011 and is headquartered in Wilsonville, Oregon.