Head-To-Head Survey: Enphase Energy (NASDAQ:ENPH) vs. ARM (NASDAQ:ARM)

Enphase Energy (NASDAQ:ENPH) and ARM (NASDAQ:ARM) are both large-cap oils/energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitability, earnings, analyst recommendations and dividends.

Analyst Recommendations

This is a summary of current ratings and price targets for Enphase Energy and ARM, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Enphase Energy	3	10	18	0	2.48
ARM	1	10	16	1	2.61

Enphase Energy presently has a consensus target price of $128.89, suggesting a potential upside of 23.21%. ARM has a consensus target price of $121.56, suggesting a potential downside of 4.45%. Given Enphase Energy’s higher probable upside, analysts clearly believe Enphase Energy is more favorable than ARM.

Profitability

This table compares Enphase Energy and ARM’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Enphase Energy	9.12%	17.30%	4.94%
ARM	12.12%	18.97%	13.23%

Valuation and Earnings

This table compares Enphase Energy and ARM’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Enphase Energy	$2.29 billion	6.18	$438.94 million	$1.92	54.48
ARM	$3.50 billion	38.12	$306.00 million	N/A	N/A

Enphase Energy has higher earnings, but lower revenue than ARM.

Institutional and Insider Ownership

72.1% of Enphase Energy shares are held by institutional investors. Comparatively, 7.5% of ARM shares are held by institutional investors. 3.4% of Enphase Energy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

ARM beats Enphase Energy on 8 of the 13 factors compared between the two stocks.

About Enphase Energy

Enphase Energy, Inc., together with its subsidiaries, designs, develops, manufactures, and sells home energy solutions for the solar photovoltaic industry in the United States and internationally. The company offers semiconductor-based microinverter, which converts energy at the individual solar module level and combines with its proprietary networking and software technologies to provide energy monitoring and control. It also provides microinverter units and related accessories, an IQ gateway; IQ batteries; the cloud-based Enlighten monitoring service; storage solutions; and electric vehicle charging solutions, as well as design, proposal, permitting, and lead generation services. The company sells its solutions to solar distributors; and directly to large installers, original equipment manufacturers, strategic partners, and homeowners, as well as through its legacy product upgrade program or online store. Enphase Energy, Inc. was incorporated in 2006 and is headquartered in Fremont, California.

About ARM

Arm Holdings plc architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers rely on to develop products. It offers microprocessors, systems intellectual property (IPs), graphics processing units, physical IP and associated systems IPs, software, tools, and other related services. Its products are used in various markets, such as automotive, computing infrastructure, consumer technologies, and Internet of things. The company operates in the United States, the People's Republic of China, Taiwan, South Korea, and internationally. The company was founded in 1990 and is headquartered in Cambridge, the United Kingdom. Arm Holdings plc operates as a subsidiary of Kronos II LLC.