Power Solutions International (NASDAQ:PSIX – Get Free Report) and Erayak Power Solution Group (NASDAQ:RAYA – Get Free Report) are both small-cap industrials companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.
Profitability
This table compares Power Solutions International and Erayak Power Solution Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Power Solutions International | 10.03% | 37.73% | 15.58% |
| Erayak Power Solution Group | N/A | N/A | N/A |
Risk & Volatility
Power Solutions International has a beta of 2.01, indicating that its stock price is 101% more volatile than the S&P 500. Comparatively, Erayak Power Solution Group has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Power Solutions International | 0 | 1 | 1 | 1 | 3.00 |
| Erayak Power Solution Group | 1 | 0 | 0 | 0 | 1.00 |
Power Solutions International currently has a consensus price target of $99.95, suggesting a potential upside of 174.36%. Given Power Solutions International’s stronger consensus rating and higher possible upside, equities analysts plainly believe Power Solutions International is more favorable than Erayak Power Solution Group.
Insider & Institutional Ownership
22.3% of Power Solutions International shares are held by institutional investors. Comparatively, 0.3% of Erayak Power Solution Group shares are held by institutional investors. 0.3% of Power Solutions International shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Power Solutions International and Erayak Power Solution Group”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Power Solutions International | $722.41 million | 1.16 | $113.99 million | $2.95 | 12.35 |
| Erayak Power Solution Group | $22.85 million | 0.05 | -$1.39 million | N/A | N/A |
Power Solutions International has higher revenue and earnings than Erayak Power Solution Group.
Summary
Power Solutions International beats Erayak Power Solution Group on 13 of the 13 factors compared between the two stocks.
About Power Solutions International
Power Solutions International, Inc. engages in the design, manufacture, and trade of power systems and electrical power generation equipment. The firm provides integrated turnkey solutions to global original equipment manufacturers and end-user customers within the energy, industrial, and transportation end markets. The company was founded by Gary S. Winemaster, Kenneth J. Winemaster, and William Winemaster in February 1985 and is headquartered in Wood Dale, IL.
About Erayak Power Solution Group
Erayak Power Solution Group Inc., through its subsidiaries, engages in the research and development, manufacture, and wholesale and retail of power solution products. Its product portfolio includes sine wave and off-grid inverters, inverter and gasoline generators, battery and smart chargers, and custom-designed products. The company's products are used in agricultural and industrial vehicles, recreational vehicles, electrical appliances, and outdoor living products. It operates in China, France, Poland, Mexico, and the United Kingdom. The company was incorporated in 2019 and is based in Wenzhou, the People's Republic of China. Erayak Power Solution Group Inc. operates as a subsidiary of Erayak International Limited.
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