REE Automotive (NASDAQ:REE) and Brilliance China Automotive (OTCMKTS:BCAUY) Critical Analysis

REE Automotive (NASDAQ:REE) and Brilliance China Automotive (OTCMKTS:BCAUY) are both auto/tires/trucks companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, dividends, analyst recommendations, valuation and earnings.

Analyst Ratings

This is a breakdown of current recommendations and price targets for REE Automotive and Brilliance China Automotive, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
REE Automotive	1	0	2	1	2.75
Brilliance China Automotive	0	0	0	0	N/A

REE Automotive currently has a consensus target price of $19.67, indicating a potential upside of 495.96%. Given REE Automotive’s higher probable upside, research analysts plainly believe REE Automotive is more favorable than Brilliance China Automotive.

Institutional and Insider Ownership

12.7% of REE Automotive shares are held by institutional investors. 6.0% of REE Automotive 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.

Risk and Volatility

REE Automotive has a beta of 2.97, meaning that its share price is 197% more volatile than the S&P 500. Comparatively, Brilliance China Automotive has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500.

Profitability

This table compares REE Automotive and Brilliance China Automotive’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
REE Automotive	-6,265.21%	-110.59%	-73.76%
Brilliance China Automotive	N/A	N/A	N/A

Valuation & Earnings

This table compares REE Automotive and Brilliance China Automotive’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
REE Automotive	$1.61 million	21.54	-$114.21 million	($10.81)	-0.31
Brilliance China Automotive	$548.32 million	4.23	$978.56 million	N/A	N/A

Brilliance China Automotive has higher revenue and earnings than REE Automotive.

Summary

REE Automotive beats Brilliance China Automotive on 7 of the 12 factors compared between the two stocks.

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 Brilliance China Automotive

Brilliance China Automotive Holdings Limited, an investment holding company, manufactures and sells BMW vehicles and automotive components in the People's Republic of China and internationally. The company offers minibuses under the JinBei, Renault, Haise, Grand Haise, and Granse brands, as well as multi-purpose vehicles under the Huasong brand. Its automotive components include moldings, seats, axles, safety and airbag systems, and interior decoration products, as well as engines for minibuses, sedans, sport utility vehicles, light duty trucks, etc. The company also provides BMW sport activity vehicles. In addition, it offers auto-financing services to customers and dealers. Brilliance China Automotive Holdings Limited has strategic partnerships and alliances with BMW, Toyota, Magna, Bosch, Continental, Delphi, TI Automotive, and Johnson Controls. The company was incorporated in 1992 and is headquartered in Central, Hong Kong.