Financial Analysis: JA Solar Holdings, Co. (JASO) and FuelCell Energy (FCEL)

JA Solar Holdings, Co. (NASDAQ: JASO) and FuelCell Energy (NASDAQ:FCEL) are both oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, earnings, institutional ownership, valuation, risk, analyst recommendations and dividends.

Risk & Volatility

JA Solar Holdings, Co. has a beta of 1.34, suggesting that its share price is 34% more volatile than the S&P 500. Comparatively, FuelCell Energy has a beta of 1.83, suggesting that its share price is 83% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for JA Solar Holdings, Co. and FuelCell Energy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
JA Solar Holdings, Co. 0 3 0 0 2.00
FuelCell Energy 0 3 1 0 2.25

JA Solar Holdings, Co. currently has a consensus target price of $6.67, suggesting a potential upside of 7.18%. FuelCell Energy has a consensus target price of $2.00, suggesting a potential upside of 41.84%. Given FuelCell Energy’s stronger consensus rating and higher probable upside, analysts plainly believe FuelCell Energy is more favorable than JA Solar Holdings, Co..

Insider & Institutional Ownership

24.9% of JA Solar Holdings, Co. shares are owned by institutional investors. Comparatively, 14.1% of FuelCell Energy shares are owned by institutional investors. 1.7% of FuelCell Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares JA Solar Holdings, Co. and FuelCell Energy’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
JA Solar Holdings, Co. N/A N/A N/A $1.61 3.86
FuelCell Energy $83.61 million 1.00 -$36.29 million ($1.51) -0.93

JA Solar Holdings, Co. has higher revenue, but lower earnings than FuelCell Energy. FuelCell Energy is trading at a lower price-to-earnings ratio than JA Solar Holdings, Co., indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares JA Solar Holdings, Co. and FuelCell Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
JA Solar Holdings, Co. 3.41% 7.73% 2.56%
FuelCell Energy -60.75% -44.42% -14.99%

Summary

FuelCell Energy beats JA Solar Holdings, Co. on 6 of the 11 factors compared between the two stocks.

JA Solar Holdings, Co. Company Profile

JA Solar Holdings Co., Ltd. is a holding company. The Company designs, develops, manufactures and sells solar power products that convert sunlight into electricity for a range of uses. The Company is engaged in manufacturing and selling solar modules, as well as silicon wafer manufacturing. The Company operates through two segments, including manufacturing and solar projects. The manufacturing segment includes design, development and manufacture of photovoltaic (PV) products. The solar projects segment includes downstream solar projects, which are involved in electricity generation. The Company’s principal products consist of both monocrystalline and multicrystalline solar cells and solar modules. The Company sells its products primarily under JA Solar brand name, and also produces original equipment for manufacturers or customers. The Company is also engaged in the provision of solar product processing services and project development services.

FuelCell Energy Company Profile

Fuelcell Energy, Inc. delivers fuel cell power solutions. The Company is engaged in designing, manufacturing, installing, operating and maintaining fuel cell power solutions. The Company also provides turnkey power generation solutions to the customers, including power plant installation, operations and maintenance. The Company’s segment is fuel cell power plant production and research. The Company offers its services to various sectors, including utility companies, municipalities, universities, government entities and a range of industrial and commercial enterprises. The Company, by utilizing its Direct FuelCell (DFC) plants, is commercializing a tri-generation distributed hydrogen configuration that generates electricity, heat and hydrogen for industrial and/or transportation uses, as well as a fuel cell carbon capture solution for coal or gas-fired power plants. The Company is also developing and commercializing solid oxide fuel cell (SOFC) plants for sub-megawatt applications.

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