Analyzing Hesai Group (NASDAQ:HSAI) & QuantumScape (NYSE:QS)

Hesai Group (NASDAQ:HSAI) and QuantumScape (NYSE:QS) are both mid-cap auto/tires/trucks companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, earnings, risk, analyst recommendations, institutional ownership, dividends and valuation.

Institutional and Insider Ownership

48.5% of Hesai Group shares are owned by institutional investors. Comparatively, 29.9% of QuantumScape shares are owned by institutional investors. 5.5% of QuantumScape shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Hesai Group and QuantumScape”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hesai Group	$284.57 million	10.34	-$14.02 million	$0.42	53.41
QuantumScape	N/A	N/A	-$477.86 million	($0.81)	-13.77

Hesai Group has higher revenue and earnings than QuantumScape. QuantumScape is trading at a lower price-to-earnings ratio than Hesai Group, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Hesai Group and QuantumScape, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hesai Group	0	1	6	2	3.11
QuantumScape	4	7	0	0	1.64

Hesai Group presently has a consensus target price of $30.80, suggesting a potential upside of 37.31%. QuantumScape has a consensus target price of $9.17, suggesting a potential downside of 17.82%. Given Hesai Group’s stronger consensus rating and higher possible upside, research analysts clearly believe Hesai Group is more favorable than QuantumScape.

Profitability

This table compares Hesai Group and QuantumScape’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hesai Group	15.70%	8.04%	5.94%
QuantumScape	N/A	-39.90%	-35.31%

Risk & Volatility

Hesai Group has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500. Comparatively, QuantumScape has a beta of 2.76, meaning that its stock price is 176% more volatile than the S&P 500.

Summary

Hesai Group beats QuantumScape on 12 of the 14 factors compared between the two stocks.

About Hesai Group

Hesai Group, through with its subsidiaries, engages in the development, manufacture, and sale of three-dimensional light detection and ranging solutions (LiDAR). Its LiDAR products are used in passenger and commercial vehicles with advanced driver assistance systems; autonomous passenger and freight mobility services; and other applications, such as delivery robots, street sweeping robots, and logistics robots in restricted areas. Hesai Group was founded in 2014 and is based in Shanghai, China.

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.