Spruce Power (NYSE:SPRU – Get Free Report) and ESS Tech (NYSE:GWH – Get Free Report) are both small-cap computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, dividends, institutional ownership, analyst recommendations, profitability and earnings.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for Spruce Power and ESS Tech, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Spruce Power | 1 | 0 | 0 | 0 | 1.00 |
| ESS Tech | 1 | 3 | 1 | 0 | 2.00 |
ESS Tech has a consensus price target of $2.50, suggesting a potential upside of 93.65%. Given ESS Tech’s stronger consensus rating and higher probable upside, analysts plainly believe ESS Tech is more favorable than Spruce Power.
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Spruce Power | $82.11 million | 0.92 | -$70.49 million | ($1.38) | -3.03 |
| ESS Tech | $1.58 million | 19.10 | -$63.44 million | ($4.33) | -0.30 |
ESS Tech has lower revenue, but higher earnings than Spruce Power. Spruce Power is trading at a lower price-to-earnings ratio than ESS Tech, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
20.8% of Spruce Power shares are owned by institutional investors. Comparatively, 46.8% of ESS Tech shares are owned by institutional investors. 12.7% of Spruce Power shares are owned by company insiders. Comparatively, 1.7% of ESS Tech shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Spruce Power and ESS Tech’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Spruce Power | -23.23% | -18.82% | -2.86% |
| ESS Tech | -1,045.28% | -1,141.31% | -140.58% |
Risk and Volatility
Spruce Power has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500. Comparatively, ESS Tech has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500.
Summary
ESS Tech beats Spruce Power on 8 of the 14 factors compared between the two stocks.
About Spruce Power
Spruce Power Holding Corporation owns and operates distributed solar energy assets in the United States. The company provides subscription-based services for homeowners and businesses to own and maintain rooftop solar and battery storage. It offers its subscription-based services to approximately 75,000 customers. The company is headquartered in Denver, Colorado.
About ESS Tech
ESS Tech, Inc., an energy storage company, designs and produces iron flow batteries for commercial and utility-scale energy storage applications worldwide. It offers energy storage products, which include Energy Warehouse, a behind-the-meter solution; and Energy Center, a front-of-the-meter solution. The company was founded in 2011 and is headquartered in Wilsonville, Oregon.
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