QuantumScape (NYSE:QS) & PHINIA (NYSE:PHIN) Critical Analysis

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

Institutional and Insider Ownership

29.9% of QuantumScape shares are held by institutional investors. Comparatively, 90.9% of PHINIA shares are held by institutional investors. 5.5% of QuantumScape shares are held by company insiders. Comparatively, 2.0% of PHINIA shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
QuantumScape	N/A	-39.90%	-35.31%
PHINIA	3.73%	12.56%	5.15%

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QuantumScape	3	6	0	0	1.67
PHINIA	0	5	4	1	2.60

QuantumScape currently has a consensus target price of $8.98, suggesting a potential upside of 28.21%. PHINIA has a consensus target price of $66.33, suggesting a potential upside of 2.08%. Given QuantumScape’s higher possible upside, equities research analysts clearly believe QuantumScape is more favorable than PHINIA.

Volatility and Risk

QuantumScape has a beta of 2.51, meaning that its stock price is 151% more volatile than the S&P 500. Comparatively, PHINIA has a beta of 1.36, meaning that its stock price is 36% more volatile than the S&P 500.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
QuantumScape	N/A	N/A	-$477.86 million	($0.76)	-9.21
PHINIA	$3.48 billion	0.71	$130.00 million	$3.25	19.99

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

Summary

PHINIA beats QuantumScape on 11 of the 14 factors compared between the two stocks.

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.

About PHINIA

PHINIA Inc. engages in the development, design, and manufacture of integrated components and systems that optimize performance, increase efficiency, and reduce emissions in combustion and hybrid propulsion for commercial and light vehicles, and industrial applications. The company operates through Fuel Systems and Aftermarket segments. The Fuel Systems segment provides advanced fuel injection systems, including pumps, injectors, fuel rail assemblies, and engine control modules; fuel delivery modules; canisters; sensors; and electronic control modules. The segment also offers complete systems comprising associated software and calibration services, that reduce emissions and improve fuel economy for traditional and hybrid applications. The Aftermarket segment is involved in the sale of starters, alternators, and other new and remanufactured products, as well as maintenance, test equipment, and vehicle diagnostics solutions. It servs original equipment manufacturers of passenger cars, trucks, vans, sport-utility vehicles, medium-duty and heavy-duty trucks, and buses, as well as other off-highway construction, marine, and agricultural and industrial applications. PHINIA Inc. was incorporated in 2023 and is based in Auburn Hills, Michigan.