Critical Contrast: Westport Fuel Systems (NASDAQ:WPRT) versus QuantumScape (NYSE:QS)

QuantumScape (NYSE:QS) and Westport Fuel Systems (NASDAQ:WPRT) are both auto/tires/trucks companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, dividends, earnings, valuation and risk.

Earnings & Valuation

This table compares QuantumScape and Westport Fuel Systems”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)	-8.17
Westport Fuel Systems	$302.30 million	0.11	-$21.84 million	($3.50)	-0.55

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

Institutional & Insider Ownership

29.9% of QuantumScape shares are owned by institutional investors. Comparatively, 21.3% of Westport Fuel Systems shares are owned by institutional investors. 5.5% of QuantumScape shares are owned by insiders. Comparatively, 0.8% of Westport Fuel Systems shares are owned by 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.

Risk & Volatility

QuantumScape has a beta of 2.51, suggesting that its share price is 151% more volatile than the S&P 500. Comparatively, Westport Fuel Systems has a beta of 2.14, suggesting that its share price is 114% more volatile than the S&P 500.

Profitability

This table compares QuantumScape and Westport Fuel Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QuantumScape	N/A	-39.90%	-35.31%
Westport Fuel Systems	-25.63%	-24.16%	-11.64%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for QuantumScape and Westport Fuel Systems, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QuantumScape	3	6	0	0	1.67
Westport Fuel Systems	1	2	1	0	2.00

QuantumScape currently has a consensus price target of $8.98, indicating a potential upside of 44.52%. Westport Fuel Systems has a consensus price target of $4.50, indicating a potential upside of 131.96%. Given Westport Fuel Systems’ stronger consensus rating and higher possible upside, analysts plainly believe Westport Fuel Systems is more favorable than QuantumScape.

Summary

Westport Fuel Systems beats QuantumScape on 8 of the 13 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 Westport Fuel Systems

Westport Fuel Systems Inc. engages in the engineering, manufacturing, and supplying alternative fuel systems and components for use in transportation applications in Europe, Asia, North America, South America, and internationally. The company operates through two segments, Original Equipment Manufacturers and Independent Aftermarket. It offers alternative fuel systems and components, such as liquefied petroleum gas (LPG), compressed natural gas (CNG), liquefied natural gas (LNG), renewable natural gas or biomethane, and hydrogen; and pressure regulators, injectors, electronic control units, valves and filters, complete bi-fuel, mono-fuel and dual-fuel LPG and natural gas conversion kits and high-pressure hydrogen components. The company provides Westport’s LNG high pressure direct injection 2.0 fuel system and bi-fuel products; offers turnkey solutions covering all process phases, including prototyping, development, calibration, validation, homologation, vehicle conversion and logistic services, as well as systems for diesel-powered vehicles; and supplies hydrogen fuel system components for light, medium, and heavy-duty applications. It offers its products under the AFS, BRC, Emer, GFI, HPDI, Stako, Prins, Zavoli, OMVL, TA Gas Technology, Vialle, and Valtek brands. The company was formerly known as Westport Innovations Inc. and changed its name to Westport Fuel Systems Inc. in June 2016. Westport Fuel Systems Inc. was incorporated in 1995 and is headquartered in Vancouver, Canada.