Financial Review: Federal Screw Works (OTCMKTS:FSCR) versus QuantumScape (NYSE:QS)

QuantumScape (NYSE:QS) and Federal Screw Works (OTCMKTS:FSCR) are both auto/tires/trucks companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, risk, institutional ownership, dividends, profitability and earnings.

Risk & Volatility

QuantumScape has a beta of 2.61, indicating that its share price is 161% more volatile than the S&P 500. Comparatively, Federal Screw Works has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Profitability

This table compares QuantumScape and Federal Screw Works’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QuantumScape	N/A	-39.90%	-35.31%
Federal Screw Works	0.99%	N/A	N/A

Insider & Institutional Ownership

29.9% of QuantumScape shares are held by institutional investors. 3.9% of QuantumScape shares are held by insiders. Comparatively, 46.2% of Federal Screw Works shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares QuantumScape and Federal Screw Works”s gross 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)	-9.96
Federal Screw Works	$97.55 million	0.11	$1.62 million	$0.71	10.70

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

Analyst Ratings

This is a breakdown of current ratings and price targets for QuantumScape and Federal Screw Works, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QuantumScape	1	6	0	0	1.86
Federal Screw Works	0	0	0	0	0.00

QuantumScape presently has a consensus target price of $11.13, indicating a potential upside of 57.47%. Given QuantumScape’s stronger consensus rating and higher probable upside, equities analysts plainly believe QuantumScape is more favorable than Federal Screw Works.

Summary

Federal Screw Works beats QuantumScape on 8 of the 12 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 Federal Screw Works

Federal Screw Works manufactures and sells industrial component parts primarily to the automobile industry in the United States. It operates through Big Rapids, Romulus, Traverse City, and Novex Tool divisions. The company offers cold formed and machined pins, including piston pins, planetary and differential gear shafts, and oil pump and steering shafts for the automotive, refrigeration, and small engine industries; and cold formed machined products, such as suspension ball studs, fluid line adapters, and precision formed and machined valve lifter bodies to the automotive industry. It also provides close tolerance machined products that are used in transmission valves, ball joints, steering gear bulkhead assemblies, torque converter hubs, and piston pins; and engineered nut products comprising prevailing torque nuts, free spinning nuts, slotted nuts, nut retainer assemblies, and nut washer assemblies to the automotive industry. In addition, the company offers cold form tooling products, which include assemblies, sleeves, dies, and punches; and complex cold formed parts, such as tie rod housings, valve lifter bodies, and suspension components. Federal Screw Works was founded in 1917 and is based in Romulus, Michigan.