QuantumScape (NYSE:QS – Get Free Report) and AB Volvo (OTCMKTS:VLVLY – Get Free Report) are both auto/tires/trucks companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, dividends, profitability, earnings and valuation.
Insider and Institutional Ownership
29.9% of QuantumScape shares are owned by institutional investors. Comparatively, 0.0% of AB Volvo shares are owned by institutional investors. 3.9% of QuantumScape shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Profitability
This table compares QuantumScape and AB Volvo’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| QuantumScape | N/A | -39.90% | -35.31% |
| AB Volvo | 8.32% | 22.17% | 5.92% |
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| QuantumScape | 1 | 6 | 0 | 0 | 1.86 |
| AB Volvo | 1 | 6 | 0 | 3 | 2.50 |
QuantumScape presently has a consensus price target of $11.13, indicating a potential upside of 57.47%. Given QuantumScape’s higher probable upside, equities analysts clearly believe QuantumScape is more favorable than AB Volvo.
Volatility and Risk
QuantumScape has a beta of 2.6, suggesting that its share price is 160% more volatile than the S&P 500. Comparatively, AB Volvo has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.
Valuation & Earnings
This table compares QuantumScape and AB Volvo”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| QuantumScape | N/A | N/A | -$477.86 million | ($0.71) | -9.96 |
| AB Volvo | $48.98 billion | 1.43 | $3.52 billion | $2.03 | 16.94 |
AB Volvo has higher revenue and earnings than QuantumScape. QuantumScape is trading at a lower price-to-earnings ratio than AB Volvo, indicating that it is currently the more affordable of the two stocks.
Summary
AB Volvo beats QuantumScape on 9 of the 13 factors compared between the two stocks.
About QuantumScape
QuantumScape Corporation, a research and development stage company, focuses on the development and commercialization of solid-state lithium-metal batteries for electric vehicles and other applications. The company was founded in 2010 and is headquartered in San Jose, California.
About AB Volvo
AB Volvo (publ), together with its subsidiaries, manufactures and sells trucks, buses, construction equipment, and marine and industrial engines in Europe, the United States, Asia, Africa, and Oceania. The company provides heavy-duty trucks for long-haulage and construction work and light-duty trucks for distribution purposes under the Volvo, Renault Trucks, Mack, Eicher, and Dongfeng Trucks brands; and city and intercity buses, coaches, and chassis under the Prevost and Volvo Bus brands. It offers road construction machine, haulers, wheel loaders, excavators, and compact equipment. In addition, the company offers engines and power solutions for leisure and commercial vessels, as well as for power generation, industrial, and off-highway applications under the Volvo Penta brand name. Further, it provides financing, insurance, rental, spare parts, repairs, preventive maintenance, service agreement, and assistance services. The company offers its products and services through a network of dealerships and workshops. It has a strategic alliance with Isuzu Motors within commercial vehicles; a partnership with Samsung SDI Co to develop batteries for its electric products; and an agreement with Aurora to develop autonomous trucks. AB Volvo (publ) was incorporated in 1915 and is headquartered in Gothenburg, Sweden.
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