Reviewing Pinnacle West Capital (NYSE:PNW) & Polar Power (NASDAQ:POLA)

Polar Power (NASDAQ:POLA) and Pinnacle West Capital (NYSE:PNW) are both utilities companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, valuation, earnings, risk, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Polar Power and Pinnacle West Capital, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Polar Power	1	0	0	0	1.00
Pinnacle West Capital	1	11	3	0	2.13

Pinnacle West Capital has a consensus price target of $100.08, suggesting a potential downside of 2.74%. Given Pinnacle West Capital’s stronger consensus rating and higher probable upside, analysts plainly believe Pinnacle West Capital is more favorable than Polar Power.

Institutional & Insider Ownership

26.1% of Polar Power shares are owned by institutional investors. Comparatively, 91.5% of Pinnacle West Capital shares are owned by institutional investors. 30.8% of Polar Power shares are owned by insiders. Comparatively, 0.2% of Pinnacle West Capital shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Polar Power and Pinnacle West Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Polar Power	-104.14%	-135.21%	-55.02%
Pinnacle West Capital	11.55%	8.82%	2.12%

Valuation and Earnings

This table compares Polar Power and Pinnacle West Capital”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Polar Power	$13.97 million	0.35	-$4.68 million	($2.24)	-0.82
Pinnacle West Capital	$5.34 billion	2.33	$616.53 million	$5.06	20.34

Pinnacle West Capital has higher revenue and earnings than Polar Power. Polar Power is trading at a lower price-to-earnings ratio than Pinnacle West Capital, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Polar Power has a beta of 1.39, indicating that its share price is 39% more volatile than the S&P 500. Comparatively, Pinnacle West Capital has a beta of 0.54, indicating that its share price is 46% less volatile than the S&P 500.

Summary

Pinnacle West Capital beats Polar Power on 12 of the 14 factors compared between the two stocks.

About Polar Power

Polar Power, Inc. designs, manufactures, and sells direct current (DC) power generators, renewable energy, and cooling systems in the United States and internationally. The company offers DC base power systems, DC hybrid power systems, DC solar hybrid power systems, and mobile power systems. Its DC power systems are available in diesel, natural gas, LPG/propane, and renewable fuel formats. It serves customers in the telecommunications, military, commercial, industrial, and marine markets. In addition, the company sells its products through a direct sales force, and independent service providers and dealers. The company was formerly known as Polar Products, Inc. and changed its name to Polar Power, Inc. in October 1991. Polar Power, Inc. was incorporated in 1979 and is based in Gardena, California.

About Pinnacle West Capital

Pinnacle West Capital Corporation, through its subsidiary, provides retail and wholesale electric services primarily in the state of Arizona. The company engages in the generation, transmission, and distribution of electricity using coal, nuclear, gas, oil, and solar generating facilities. Its transmission facilities include overhead lines and underground lines; and distribution facilities consist of overhead lines and underground primary cables. The company also owns and maintains transmission and distribution substations; and owns energy storage facilities. Pinnacle West Capital Corporation was incorporated in 1985 and is headquartered in Phoenix, Arizona.