REE Automotive (NASDAQ:REE – Get Free Report) and Faraday Future Intelligent Electric (NASDAQ:FFAI – Get Free Report) are both small-cap auto/tires/trucks companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.
Volatility & Risk
REE Automotive has a beta of 2.73, meaning that its share price is 173% more volatile than the S&P 500. Comparatively, Faraday Future Intelligent Electric has a beta of 5.24, meaning that its share price is 424% more volatile than the S&P 500.
Valuation and Earnings
This table compares REE Automotive and Faraday Future Intelligent Electric”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| REE Automotive | $180,000.00 | 72.30 | -$111.75 million | ($7.19) | -0.08 |
| Faraday Future Intelligent Electric | $540,000.00 | 255.64 | -$355.85 million | ($1.84) | -0.38 |
REE Automotive has higher earnings, but lower revenue than Faraday Future Intelligent Electric. Faraday Future Intelligent Electric is trading at a lower price-to-earnings ratio than REE Automotive, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
12.7% of REE Automotive shares are owned by institutional investors. Comparatively, 71.7% of Faraday Future Intelligent Electric shares are owned by institutional investors. 0.4% of Faraday Future Intelligent Electric shares are owned by company 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 breakdown of recent ratings and price targets for REE Automotive and Faraday Future Intelligent Electric, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| REE Automotive | 1 | 2 | 1 | 0 | 2.00 |
| Faraday Future Intelligent Electric | 1 | 1 | 1 | 0 | 2.00 |
REE Automotive currently has a consensus price target of $8.17, suggesting a potential upside of 1,296.97%. Faraday Future Intelligent Electric has a consensus price target of $5.00, suggesting a potential upside of 612.45%. Given REE Automotive’s higher probable upside, equities analysts plainly believe REE Automotive is more favorable than Faraday Future Intelligent Electric.
Profitability
This table compares REE Automotive and Faraday Future Intelligent Electric’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| REE Automotive | N/A | N/A | N/A |
| Faraday Future Intelligent Electric | -74,517.13% | -518.14% | -91.88% |
About REE Automotive
REE Automotive Ltd. operates as an automotive technology company in France, the United Kingdom, the United States, and internationally. The company offers REEcorner, a compact module that integrates critical vehicle drive components comprising as steering, braking, suspension, powertrain, and control between the chassis and the wheel; and REEplatform that allows for the addition of a modular and customizable top hat/cabin design based on customer specifications, without requiring modification to the platform. It also provides P7-S Strip Chassis for commercial delivery vehicles and walk-in vans; P7-C Chassis Cab and Cutway Chassis, a class 4 chassis cab fully electric commercial truck for delivery and a range of vocational applications; and P7-B Box Truck, a class 3 box truck built on a P7 cab chassis with its all-wheel drive and all-wheel steer for vehicle control for better handling and safety in adverse conditions. It serves original equipment manufacturer, delivery and logistic fleets, dealers, e-commerce retailers, new mobility players, mobility-as-a-service providers, and autonomous drive companies. The company is headquartered in Herzliya, Israel.
About Faraday Future Intelligent Electric
Faraday Future Intelligent Electric Inc. engages in the design, development, manufacture, engineering, sale, and distribution of electric vehicles and related products in the United States and internationally. The company was founded in 2014 and is headquartered in Gardena, California.
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