Tecnoglass (NASDAQ: TGLS) and Real Goods Solar (NASDAQ:RGSE) are both small-cap retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, valuation, analyst recommendations, earnings and risk.

Valuation and Earnings

This table compares Tecnoglass and Real Goods Solar’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Tecnoglass $308.14 million 0.77 $57.67 million ($0.27) -25.96
Real Goods Solar $14.24 million 0.46 -$12.03 million ($334.75) 0.00

Tecnoglass has higher revenue and earnings than Real Goods Solar. Tecnoglass is trading at a lower price-to-earnings ratio than Real Goods Solar, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

3.8% of Tecnoglass shares are held by institutional investors. Comparatively, 3.3% of Real Goods Solar shares are held by institutional investors. 67.2% of Tecnoglass shares are held by insiders. Comparatively, 0.2% of Real Goods Solar shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and target prices for Tecnoglass and Real Goods Solar, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tecnoglass 0 1 1 0 2.50
Real Goods Solar 0 0 0 0 N/A

Tecnoglass presently has a consensus price target of $17.00, suggesting a potential upside of 142.55%. Given Tecnoglass’ higher possible upside, research analysts clearly believe Tecnoglass is more favorable than Real Goods Solar.

Dividends

Tecnoglass pays an annual dividend of $0.13 per share and has a dividend yield of 1.9%. Real Goods Solar does not pay a dividend. Tecnoglass pays out -48.1% of its earnings in the form of a dividend.

Profitability

This table compares Tecnoglass and Real Goods Solar’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tecnoglass -2.45% 16.94% 4.36%
Real Goods Solar -184.38% -233.16% -88.89%

Risk and Volatility

Tecnoglass has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500. Comparatively, Real Goods Solar has a beta of 2.07, suggesting that its share price is 107% more volatile than the S&P 500.

Summary

Tecnoglass beats Real Goods Solar on 13 of the 14 factors compared between the two stocks.

Tecnoglass Company Profile

Tecnoglass Inc., through its subsidiaries, manufactures and sells architectural glass and windows for residential and commercial construction industries in North, Central, and South America. The company offers soft coat, laminated/thermo-laminated, thermo-acoustic, tempered, silk-screened, curved, and digital print glass. It also produces, exports, imports, and markets aluminum products, including profiles, rods, bars, plates, tubes, and other hardware used in the manufacture of architectural glass settings, such as windows, doors, spatial separators, and similar products. In addition, the company provides floating facades, windows and doors, commercial display windows, hurricane-proof windows, automatic doors, bathroom dividers, polyvinyl structures, and other components of architectural systems. It markets and sells its products under the Tecnoglass, ES Windows, and Alutions brands through internal and independent sales representatives, as wells as directly to distributors. The company was founded in 1984 and is headquartered in Barranquilla, Colombia. Tecnoglass Inc. is a subsidiary of Energy Holding Corporation.

Real Goods Solar Company Profile

Real Goods Solar, Inc. is a residential and commercial solar energy engineering, procurement, and construction company. The Company offers turnkey services, including design, procurement, permitting, build-out, grid connection, financing referrals and warranty and customer satisfaction activities. Its solar energy systems use solar photovoltaic (PV) modules. The Company operates in three segments: Residential – the installation of solar systems for homeowners, including lease financing thereof, and for small businesses (small commercial) in the continental United States; Sunetric – the installation of solar systems for both homeowners and small business owners (small commercial) in Hawaii, and Other – retail store and corporate operations.

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