Kimball Electronics (NASDAQ: KE) and Polar Power (NASDAQ:POLA) are both small-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, risk, profitability, institutional ownership, valuation, earnings and analyst recommendations.

Institutional and Insider Ownership

56.9% of Kimball Electronics shares are held by institutional investors. Comparatively, 8.5% of Polar Power shares are held by institutional investors. 3.9% of Kimball Electronics shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings for Kimball Electronics and Polar Power, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kimball Electronics 0 0 1 0 3.00
Polar Power 0 0 1 0 3.00

Kimball Electronics currently has a consensus target price of $17.00, indicating a potential downside of 21.66%. Polar Power has a consensus target price of $7.00, indicating a potential upside of 32.58%. Given Polar Power’s higher possible upside, analysts clearly believe Polar Power is more favorable than Kimball Electronics.

Profitability

This table compares Kimball Electronics and Polar Power’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kimball Electronics 3.67% 9.24% 5.74%
Polar Power N/A 19.35% 16.54%

Valuation and Earnings

This table compares Kimball Electronics and Polar Power’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Kimball Electronics $930.91 million 0.63 $62.96 million $1.24 17.50
Polar Power $22.14 million 2.42 $6.29 million N/A N/A

Kimball Electronics has higher revenue and earnings than Polar Power.

Summary

Kimball Electronics beats Polar Power on 6 of the 10 factors compared between the two stocks.

Kimball Electronics Company Profile

Kimball Electronics, Inc. (Kimball Electronics) is an electronics manufacturing services (EMS) company. The Company is engaged in producing electronics for the automotive, medical, industrial and public safety markets. It provides design, engineering, manufacturing, packaging and distribution of electronic assemblies and circuit boards on a contract basis to a range of industries. The Company offers various engineering, manufacturing and supply chain services, such as design services; production and testing of printed circuit board assemblies (PCBAS); industrialization and automation of manufacturing processes; product design and process validation and qualification; reliability testing, which include testing of products under a series of environmental conditions; assembly, production and packaging of other related non-electronic products, and product life cycle management. It is engaged in producing safety critical electronic assemblies for the automotive market.

Polar Power Company Profile

Polar Power, Inc. is engaged in designing, manufacturing and selling direct current (DC) power systems for applications primarily in the telecommunications, military, electric vehicle charging, cogeneration, distributed power and uninterruptable power supply markets. Within the telecommunications market, the Company’s DC power systems provide DC power to service applications that do not have access to the utility grid (such as off-grid applications) or have critical power needs and cannot be without power in the event of utility grid failure (such as back-up power applications). Its product offerings include DC base power systems, DC hybrid power systems and DC solar hybrid power systems. The Company’s technologies include Permanent Magnet Homopolar Hybrid (PMHH) Technology and Supra Controller Technology. Its power and control system architecture is controlled by its digital control system, Supra Controller, which contains software configured to meet specific application needs.

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