China Automotive Systems (NASDAQ:CAAS – Get Free Report) and BRP (NASDAQ:DOOO – Get Free Report) are both auto/tires/trucks companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, profitability, risk, institutional ownership, dividends, valuation and earnings.
Analyst Recommendations
This is a breakdown of current ratings and price targets for China Automotive Systems and BRP, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| China Automotive Systems | 0 | 1 | 0 | 0 | 2.00 |
| BRP | 0 | 6 | 9 | 4 | 2.89 |
BRP has a consensus target price of $84.40, suggesting a potential upside of 15.43%. Given BRP’s stronger consensus rating and higher probable upside, analysts clearly believe BRP is more favorable than China Automotive Systems.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| China Automotive Systems | 4.62% | 8.38% | 3.96% |
| BRP | 0.45% | 67.30% | 4.72% |
Insider & Institutional Ownership
5.2% of China Automotive Systems shares are owned by institutional investors. 64.8% of China Automotive Systems shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Risk & Volatility
China Automotive Systems has a beta of 0.96, indicating that its share price is 4% less volatile than the S&P 500. Comparatively, BRP has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500.
Earnings & Valuation
This table compares China Automotive Systems and BRP”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| China Automotive Systems | $650.93 million | 0.21 | $29.98 million | $1.11 | 4.04 |
| BRP | $8.03 billion | 0.67 | -$154.60 million | $0.37 | 197.62 |
China Automotive Systems has higher earnings, but lower revenue than BRP. China Automotive Systems is trading at a lower price-to-earnings ratio than BRP, indicating that it is currently the more affordable of the two stocks.
Summary
BRP beats China Automotive Systems on 10 of the 15 factors compared between the two stocks.
About China Automotive Systems
China Automotive Systems, Inc., through its subsidiaries, manufactures and sells automotive systems and components in the People's Republic of China, the United States, and internationally. It produces rack and pinion power steering gears for cars and light-duty vehicles; integral power steering gears for heavy-duty vehicles; power steering parts for light duty vehicles; sensor modules; automobile steering systems and columns; and automobile electronics and systems and parts. The company also offers automotive motors and electromechanical integrated systems; polymer materials; and intelligent automotive technology research and development services. In addition, it provides after sales services, and research and development support services; and inspection and testing of automotive products, as well as markets automotive parts in North America. The company primarily sells its products to the original equipment manufacturing customers. China Automotive Systems, Inc. is headquartered in Jingzhou, the People's Republic of China.
About BRP
BRP Inc., together with its subsidiaries, designs, develops, manufactures, distributes, and markets powersports vehicles and marine products in the United States, Canada, Europe, the Asia Pacific, Mexico, Austria, and internationally. The Powersports segment offers year-round products, such as Can-Am all-terrain vehicles, side-by-side vehicles, and three-wheeled vehicles; and seasonal products, including Ski-Doo and Lynx snowmobiles, Sea-Doo personal watercrafts and pontoons, Rotax engines for karts and recreational aircraft, and Pinion gearboxes with smart shift systems. The Marine segment provides Alumacraft, Manitou, Quintrex, Stacer, and Yellowfin boats; Rotax engines for jet boats; and Rotax S outboard engine. The company was formerly known as J.A. Bombardier (J.A.B.) Inc. and changed its name to BRP Inc. in April 2013. BRP Inc. was founded in 1937 and is headquartered in Valcourt, Canada.
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