Financial Contrast: Nextpower (NASDAQ:NXT) vs. Powell Industries (NASDAQ:POWL)

Powell Industries (NASDAQ:POWL) and Nextpower (NASDAQ:NXT) are both industrials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, earnings, institutional ownership, profitability, risk, dividends and analyst recommendations.

Insider and Institutional Ownership

89.8% of Powell Industries shares are held by institutional investors. Comparatively, 67.4% of Nextpower shares are held by institutional investors. 2.2% of Powell Industries shares are held by insiders. Comparatively, 0.8% of Nextpower shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Powell Industries and Nextpower”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Powell Industries	$1.10 billion	5.63	$180.75 million	$5.21	32.76
Nextpower	$3.56 billion	3.52	$585.88 million	$3.86	21.40

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

Analyst Recommendations

This is a summary of current ratings and recommmendations for Powell Industries and Nextpower, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Powell Industries	0	3	2	2	2.86
Nextpower	0	4	22	2	2.93

Powell Industries currently has a consensus target price of $215.42, suggesting a potential upside of 26.20%. Nextpower has a consensus target price of $144.96, suggesting a potential upside of 75.46%. Given Nextpower’s stronger consensus rating and higher possible upside, analysts clearly believe Nextpower is more favorable than Powell Industries.

Profitability

This table compares Powell Industries and Nextpower’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Powell Industries	16.49%	27.51%	15.94%
Nextpower	16.36%	26.29%	15.02%

Volatility & Risk

Powell Industries has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, Nextpower has a beta of 1.92, suggesting that its share price is 92% more volatile than the S&P 500.

Summary

Powell Industries beats Nextpower on 8 of the 14 factors compared between the two stocks.

About Powell Industries

Powell Industries, Inc., together with its subsidiaries, designs, develops, manufactures, sells, and services custom-engineered equipment and systems. The company’s principal products include integrated power control room substations, custom-engineered modules, electrical houses, medium-voltage circuit breakers, monitoring and control communications systems, motor control centers, switches, and bus duct systems, as well as traditional and arc-resistant distribution switchgears and control gears. Its products have application in voltages ranging from 480 volts to 38,000 volts. The company also provide field service inspection, installation, commissioning, modification and repair, spare parts, retrofit and retrofill components for existing systems, and replacement circuit breakers for switchgear. It serves onshore and offshore production, liquefied natural gas facilities and terminals, pipelines, refineries, and petrochemical plants, as well as electric utility, light rail traction power, mining and metals, pulp and paper, data centers and other municipal, commercial, and industrial markets. The company has operations in the United States, Canada, the Middle East, Africa, Europe, Mexico, and Central and South America. Powell Industries, Inc. was founded in 1947 and is headquartered in Houston, Texas.

About Nextpower

Nextpower, formerly known as Nextracker, an energy solutions company, provides solar trackers and software solutions for utility-scale and distributed generation solar projects in the United States and internationally. The company offers tracking solutions, which includes NX Horizon, a solar tracking solution; and NX Horizon-XTR, a terrain-following tracker designed to expand the addressable market for trackers on sites with sloped, uneven, and challenging terrain. It also provides TrueCapture, a self-adjusting tracker control system, which boosts solar power plant production by optimizing the position of individual tracker row in response to site features, such as varying topography and changing weather conditions; and NX Navigator, that assists solar power plant owners and operators in monitoring, controlling, and protecting their solar projects. The company was founded in 2013 and is headquartered in Fremont, California. As of March 31, 2024 Nextracker Inc. (Nextpower) was formerly a subsidiary of Flex Ltd.