Comparing Polar Power (NASDAQ:POLA) and Pinnacle West Capital (NYSE:PNW)

Pinnacle West Capital (NYSE:PNW) and Polar Power (NASDAQ:POLA) are both utilities companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Profitability

This table compares Pinnacle West Capital and Polar Power’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pinnacle West Capital	11.55%	8.82%	2.12%
Polar Power	-104.14%	-135.21%	-55.02%

Risk and Volatility

Pinnacle West Capital has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500. Comparatively, Polar Power has a beta of 1.39, suggesting that its stock price is 39% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Pinnacle West Capital and Polar Power, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pinnacle West Capital	1	11	3	0	2.13
Polar Power	1	0	0	0	1.00

Pinnacle West Capital currently has a consensus target price of $100.08, suggesting a potential downside of 0.82%. Given Pinnacle West Capital’s stronger consensus rating and higher probable upside, equities analysts clearly believe Pinnacle West Capital is more favorable than Polar Power.

Earnings & Valuation

This table compares Pinnacle West Capital and Polar Power”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pinnacle West Capital	$5.34 billion	2.28	$616.53 million	$5.06	19.94
Polar Power	$13.97 million	0.34	-$4.68 million	($2.24)	-0.80

Pinnacle West Capital has higher revenue and earnings than Polar Power. Polar Power is trading at a lower price-to-earnings ratio than Pinnacle West Capital, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

91.5% of Pinnacle West Capital shares are held by institutional investors. Comparatively, 26.1% of Polar Power shares are held by institutional investors. 0.2% of Pinnacle West Capital shares are held by insiders. Comparatively, 30.8% of Polar Power shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Pinnacle West Capital beats Polar Power on 12 of the 14 factors compared between the two stocks.

About Pinnacle West Capital

Pinnacle West Capital Corporation, through its subsidiary, provides retail and wholesale electric services primarily in the state of Arizona. The company engages in the generation, transmission, and distribution of electricity using coal, nuclear, gas, oil, and solar generating facilities. Its transmission facilities include overhead lines and underground lines; and distribution facilities consist of overhead lines and underground primary cables. The company also owns and maintains transmission and distribution substations; and owns energy storage facilities. Pinnacle West Capital Corporation was incorporated in 1985 and is headquartered in Phoenix, Arizona.

About Polar Power

Polar Power, Inc. designs, manufactures, and sells direct current (DC) power generators, renewable energy, and cooling systems in the United States and internationally. The company offers DC base power systems, DC hybrid power systems, DC solar hybrid power systems, and mobile power systems. Its DC power systems are available in diesel, natural gas, LPG/propane, and renewable fuel formats. It serves customers in the telecommunications, military, commercial, industrial, and marine markets. In addition, the company sells its products through a direct sales force, and independent service providers and dealers. The company was formerly known as Polar Products, Inc. and changed its name to Polar Power, Inc. in October 1991. Polar Power, Inc. was incorporated in 1979 and is based in Gardena, California.