Generac (NYSE:GNRC) versus Powell Industries (NASDAQ:POWL) Critical Contrast
by Danessa Lincoln · The Markets DailyPowell Industries (NASDAQ:POWL – Get Free Report) and Generac (NYSE:GNRC – Get Free Report) are both industrials companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, dividends, earnings, valuation and risk.
Earnings & Valuation
This table compares Powell Industries and Generac”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Powell Industries | $1.10 billion | 4.56 | $180.75 million | $5.21 | 26.53 |
| Generac | $4.62 billion | 2.32 | $159.55 million | $5.05 | 36.02 |
Powell Industries has higher earnings, but lower revenue than Generac. Powell Industries is trading at a lower price-to-earnings ratio than Generac, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
89.8% of Powell Industries shares are owned by institutional investors. Comparatively, 84.0% of Generac shares are owned by institutional investors. 2.2% of Powell Industries shares are owned by insiders. Comparatively, 2.4% of Generac shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Risk & Volatility
Powell Industries has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500. Comparatively, Generac has a beta of 1.86, suggesting that its share price is 86% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for Powell Industries and Generac, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Powell Industries | 0 | 3 | 2 | 2 | 2.86 |
| Generac | 0 | 7 | 13 | 2 | 2.77 |
Powell Industries currently has a consensus price target of $187.92, indicating a potential upside of 35.96%. Generac has a consensus price target of $289.82, indicating a potential upside of 59.34%. Given Generac’s higher possible upside, analysts plainly believe Generac is more favorable than Powell Industries.
Profitability
This table compares Powell Industries and Generac’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% |
| Generac | 6.52% | 18.78% | 9.12% |
Summary
Powell Industries beats Generac on 8 of the 14 factors compared between the two stocks.
About Powell Industries
Powell Industries designs, manufactures and services custom-engineered electrical equipment and systems used to distribute, control and monitor electrical power. Its offerings include electrical switchgear, control rooms and integrated power-control systems for industrial and utility applications. The company serves customers in industries such as oil and gas, petrochemicals, utilities, mining and transportation. Its equipment is used in facilities including power plants, refineries and other energy and industrial sites, in North America and international markets.
About Generac
Generac Holdings Inc. designs and manufactures backup power generation equipment and energy technology solutions. Its products include home standby and portable generators, as well as power systems for commercial, industrial, and other applications. The company also offers energy storage and management products, solar-related solutions, and services that help customers monitor and manage power use. Generac serves residential, commercial, and industrial customers, with a presence in North America and other markets around the world.