Financial Analysis: BRP (NASDAQ:DOOO) vs. Solid Power (NASDAQ:SLDP)

Solid Power (NASDAQ:SLDP) and BRP (NASDAQ:DOOO) are both auto/tires/trucks companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, dividends, earnings, valuation, risk, analyst recommendations and institutional ownership.

Profitability

This table compares Solid Power and BRP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Solid Power	-429.55%	-24.88%	-23.07%
BRP	0.45%	67.30%	4.72%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Solid Power and BRP, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Solid Power	1	0	1	0	2.00
BRP	0	5	9	3	2.88

Solid Power presently has a consensus price target of $7.00, indicating a potential upside of 74.13%. BRP has a consensus price target of $84.40, indicating a potential upside of 8.42%. Given Solid Power’s higher possible upside, equities research analysts clearly believe Solid Power is more favorable than BRP.

Volatility and Risk

Solid Power has a beta of 1.89, suggesting that its stock price is 89% more volatile than the S&P 500. Comparatively, BRP has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.

Insider & Institutional Ownership

33.7% of Solid Power shares are owned by institutional investors. 7.2% of Solid Power shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Solid Power and BRP”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Solid Power	$20.14 million	38.13	-$96.52 million	($0.53)	-7.58
BRP	$8.03 billion	0.71	-$154.60 million	$0.37	210.39

Solid Power has higher earnings, but lower revenue than BRP. Solid Power 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 Solid Power on 9 of the 15 factors compared between the two stocks.

About Solid Power

Solid Power, Inc. develops solid state battery technologies for the electric vehicles (EV) and other markets in the United States. The company sells its sulfide-based solid electrolyte; and licenses its solid-state cell designs and manufacturing processes. It also produces and sells 0.2, 2, 20 ampere-hour (Ah), and EV cells. Solid Power, Inc. was founded in 2011 and is headquartered in Louisville, Colorado.

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.