Head to Head Analysis: Aptiv (NYSE:APTV) vs. REE Automotive (NASDAQ:REE)

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

Risk & Volatility

Aptiv has a beta of 1.5, suggesting that its share price is 50% more volatile than the S&P 500. Comparatively, REE Automotive has a beta of 2.72, suggesting that its share price is 172% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Aptiv	0.81%	18.22%	7.35%
REE Automotive	N/A	N/A	N/A

Earnings & Valuation

This table compares Aptiv and REE Automotive”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aptiv	$20.40 billion	0.70	$165.00 million	$0.76	87.59
REE Automotive	$207,000.00	63.01	-$111.75 million	($7.19)	-0.08

Aptiv has higher revenue and earnings than REE Automotive. REE Automotive is trading at a lower price-to-earnings ratio than Aptiv, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings for Aptiv and REE Automotive, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aptiv	0	4	16	0	2.80
REE Automotive	1	2	1	0	2.00

Aptiv presently has a consensus target price of $99.05, suggesting a potential upside of 48.79%. REE Automotive has a consensus target price of $4.75, suggesting a potential upside of 710.58%. Given REE Automotive’s higher possible upside, analysts clearly believe REE Automotive is more favorable than Aptiv.

Insider & Institutional Ownership

94.2% of Aptiv shares are owned by institutional investors. Comparatively, 12.7% of REE Automotive shares are owned by institutional investors. 0.1% of Aptiv shares are owned by insiders. Comparatively, 6.0% of REE Automotive shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Aptiv beats REE Automotive on 10 of the 14 factors compared between the two stocks.

About Aptiv

Aptiv PLC engages in design, manufacture, and sale of vehicle components in North America, Europe, Middle East, Africa, the Asia Pacific, South America, and internationally. The company provides electrical, electronic, and safety technology solutions to the automotive and commercial vehicle markets. It operates through two segments, Signal and Power Solutions, and Advanced Safety and User Experience. The Signal and Power Solutions segment designs, manufactures, and assembles vehicle’s electrical architecture, including engineered component products, connectors, wiring assemblies and harnesses, cable management products, electrical centers, and hybrid high voltage and safety distribution systems. Its Advanced Safety and User Experience segment provides critical technologies and services for vehicle safety, security, comfort, and convenience, such as sensing and perception systems, electronic control units, multi-domain controllers, vehicle connectivity systems, application software, autonomous driving technologies, and end-to-end DevOps tools. The company was formerly known as Delphi Automotive PLC and changed its name to Aptiv PLC in December 2017. Aptiv PLC was incorporated in 2011 and is based in Dublin, Ireland.

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.