SunPower Corporation (NASDAQ: SPWR) and SolarEdge Technologies (NASDAQ:SEDG) are both small-cap oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for SunPower Corporation and SolarEdge Technologies, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SunPower Corporation 1 10 3 0 2.14
SolarEdge Technologies 3 1 9 0 2.46

SunPower Corporation currently has a consensus price target of $9.10, suggesting a potential downside of 7.41%. SolarEdge Technologies has a consensus price target of $23.33, suggesting a potential downside of 16.22%. Given SunPower Corporation’s higher probable upside, equities research analysts clearly believe SunPower Corporation is more favorable than SolarEdge Technologies.

Insider and Institutional Ownership

25.6% of SunPower Corporation shares are owned by institutional investors. Comparatively, 58.3% of SolarEdge Technologies shares are owned by institutional investors. 0.9% of SunPower Corporation shares are owned by insiders. Comparatively, 16.4% of SolarEdge Technologies 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.

Risk & Volatility

SunPower Corporation has a beta of 3.11, indicating that its share price is 211% more volatile than the S&P 500. Comparatively, SolarEdge Technologies has a beta of 0.04, indicating that its share price is 96% less volatile than the S&P 500.

Earnings and Valuation

This table compares SunPower Corporation and SolarEdge Technologies’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
SunPower Corporation $2.49 billion 0.55 -$24.89 million ($3.92) -2.51
SolarEdge Technologies $481.19 million 2.44 $66.74 million $1.42 19.61

SolarEdge Technologies has higher revenue, but lower earnings than SunPower Corporation. SunPower Corporation is trading at a lower price-to-earnings ratio than SolarEdge Technologies, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares SunPower Corporation and SolarEdge Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SunPower Corporation -21.84% -12.56% -2.88%
SolarEdge Technologies 12.64% 21.01% 14.15%

Summary

SolarEdge Technologies beats SunPower Corporation on 10 of the 13 factors compared between the two stocks.

About SunPower Corporation

SunPower Corporation is a global energy company. The Company delivers complete solar solutions to residential, commercial, and power plant customers. The Company’s segments include Residential Segment, Commercial Segment and Power Plant Segment. The Residential and Commercial Segments combined are referred to as Distributed Generation. The Company offers solar module technology and solar power systems that are designed to generate electricity over a system life over 25 years; Integrated Smart Energy software solutions that enable customers to manage and optimize the cooperation center of excellence (CCOE) measurement; Installation, construction, and ongoing maintenance and monitoring services; and financing solutions that provide customers a range of options for purchasing or leasing solar products at competitive energy rates. The Company offers a set of residential solutions that deliver value to homeowners and its dealer partners.

About SolarEdge Technologies

SolarEdge Technologies, Inc. offers an inverter solution for a solar photovoltaic (PV) system. The Company’s products include SolarEdge Power Optimizer, SolarEdge Inverter, StorEdge Solutions and SolarEdge Monitoring Software. Its product roadmap consists of categories, including power optimizers, inverters, monitoring services, energy storage and smart energy management. The Company’s power optimizers provide module-level maximum power point (MPP) tracking and real-time adjustments of current and voltage to the optimal working point of each individual PV module. The Company’s solution consists of a direct current (DC) power optimizer, an inverter and a cloud-based monitoring platform that operates as a single integrated system.

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