Ideal Power (NASDAQ: IPWR) and Yingli Green Energy Holding Company Limited (NYSE:YGE) are both small-cap industrial products companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, analyst recommendations, valuation, risk and dividends.

Profitability

This table compares Ideal Power and Yingli Green Energy Holding Company Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ideal Power -895.37% -95.52% -83.42%
Yingli Green Energy Holding Company Limited -31.08% N/A -5.70%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Ideal Power and Yingli Green Energy Holding Company Limited, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ideal Power 0 1 3 0 2.75
Yingli Green Energy Holding Company Limited 3 0 0 0 1.00

Ideal Power presently has a consensus price target of $5.00, suggesting a potential upside of 110.08%. Yingli Green Energy Holding Company Limited has a consensus price target of $3.30, suggesting a potential upside of 30.43%. Given Ideal Power’s stronger consensus rating and higher probable upside, research analysts clearly believe Ideal Power is more favorable than Yingli Green Energy Holding Company Limited.

Institutional & Insider Ownership

27.0% of Ideal Power shares are held by institutional investors. Comparatively, 3.3% of Yingli Green Energy Holding Company Limited shares are held by institutional investors. 10.0% of Ideal Power shares are held 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 and Volatility

Ideal Power has a beta of 1.52, suggesting that its stock price is 52% more volatile than the S&P 500. Comparatively, Yingli Green Energy Holding Company Limited has a beta of 2.34, suggesting that its stock price is 134% more volatile than the S&P 500.

Valuation and Earnings

This table compares Ideal Power and Yingli Green Energy Holding Company Limited’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ideal Power $1.34 million 24.86 -$11.42 million ($1.11) -2.14
Yingli Green Energy Holding Company Limited $1.09 billion 0.04 $49.32 million ($18.34) -0.14

Yingli Green Energy Holding Company Limited has higher revenue and earnings than Ideal Power. Ideal Power is trading at a lower price-to-earnings ratio than Yingli Green Energy Holding Company Limited, indicating that it is currently the more affordable of the two stocks.

Summary

Ideal Power beats Yingli Green Energy Holding Company Limited on 7 of the 13 factors compared between the two stocks.

Ideal Power Company Profile

Ideal Power Inc. (Ideal Power) designs, markets and sells electrical power conversion products using its Power Packet Switching Architecture (PPSA) technology. The Company’s PPSA is a power conversion technology that utilizes standardized hardware with application specific embedded software. It sells products to systems integrators for integration into their system, which enable end users to manage their electricity consumption by reducing demand charges or fossil fuel consumption, integrating renewable energy sources and form their own microgrid. It focuses on licensing PPSA-based product designs to original equipment manufacturers (OEMs) within its target markets. Its products use multiple insulated gate bipolar transistors (IGBTs), which switch power in a direction, including direct current (DC) to alternating current (AC), or AC to DC. The PPSA uses indirect power flow in which power flows through input switches, and is temporarily stored in its AC link inductor.

Yingli Green Energy Holding Company Limited Company Profile

Yingli Green Energy Holding Company Limited is a solar panel manufacturer. The Company’s manufacturing covers the photovoltaic value chain from ingot casting and wafering through solar cell production and solar panel assembly. The Company’s end products include photovoltaic (PV) modules and PV systems of different sizes and power outputs. The Company sells PV modules under its own brand names, Yingli and Yingli Solar, to PV system integrators and distributors located in various markets around the world, including China, Japan, the United States, the United Kingdom, Chile, Algeria, Germany, France, South Africa, Turkey and Honduras. The Company’s products and services include the manufacture of polysilicon ingots and wafers, PV cells, PV modules and integrated PV systems, and the development and operation of solar projects. The Company produces approximately 800 kilogram multi-crystalline polysilicon ingots. The Company’s PV modules have output ranging from 250 to 340 watts.

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