Analyzing Autoliv (NYSE:ALV) and QuantumScape (NYSE:QS)

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

Profitability

This table compares QuantumScape and Autoliv’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%
Autoliv	6.45%	29.03%	8.75%

Analyst Recommendations

This is a summary of current ratings and price targets for QuantumScape and Autoliv, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QuantumScape	1	6	0	0	1.86
Autoliv	0	5	8	0	2.62

QuantumScape currently has a consensus price target of $11.13, indicating a potential upside of 35.77%. Autoliv has a consensus price target of $135.00, indicating a potential upside of 9.94%. Given QuantumScape’s higher possible upside, analysts clearly believe QuantumScape is more favorable than Autoliv.

Insider & Institutional Ownership

29.9% of QuantumScape shares are held by institutional investors. Comparatively, 69.6% of Autoliv shares are held by institutional investors. 5.5% of QuantumScape shares are held by company insiders. Comparatively, 0.3% of Autoliv shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares QuantumScape and Autoliv”s top-line 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	($0.71)	-11.55
Autoliv	$10.82 billion	0.85	$735.00 million	$9.30	13.20

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

Volatility & Risk

QuantumScape has a beta of 2.57, meaning that its stock price is 157% more volatile than the S&P 500. Comparatively, Autoliv has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500.

Summary

Autoliv beats QuantumScape on 10 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 Autoliv

Autoliv, Inc., through its subsidiaries, develops, manufactures, and supplies passive safety systems to the automotive industry in Europe, the Americas, China, Japan, and rest of Asia. It offers passive safety systems, including modules and components for frontal-impact airbag protection systems, side-impact airbag protection systems, seatbelts, steering wheels, and inflator technologies. The company also provides mobility safety solutions, such as pedestrian protection, battery cut-off switches, connected safety services, and safety solutions for riders of powered two wheelers. It primarily serves car manufacturers. Autoliv, Inc. was founded in 1953 and is headquartered in Stockholm, Sweden.