Faraday Future Intelligent Electric (NASDAQ:FFAI – Get Free Report) and REE Automotive (NASDAQ:REE – Get Free Report) are both small-cap auto/tires/trucks companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, dividends, institutional ownership, earnings, profitability and valuation.
Institutional and Insider Ownership
71.7% of Faraday Future Intelligent Electric shares are held by institutional investors. Comparatively, 12.7% of REE Automotive shares are held by institutional investors. 0.4% of Faraday Future Intelligent Electric shares are held by insiders. Comparatively, 6.0% of REE Automotive shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Volatility & Risk
Faraday Future Intelligent Electric has a beta of 5.24, suggesting that its share price is 424% more volatile than the S&P 500. Comparatively, REE Automotive has a beta of 2.73, suggesting that its share price is 173% more volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Faraday Future Intelligent Electric | 1 | 1 | 1 | 0 | 2.00 |
| REE Automotive | 1 | 2 | 1 | 0 | 2.00 |
Faraday Future Intelligent Electric presently has a consensus target price of $5.00, suggesting a potential upside of 719.67%. REE Automotive has a consensus target price of $8.17, suggesting a potential upside of 1,335.77%. Given REE Automotive’s higher probable upside, analysts clearly believe REE Automotive is more favorable than Faraday Future Intelligent Electric.
Earnings and Valuation
This table compares Faraday Future Intelligent Electric and REE Automotive”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Faraday Future Intelligent Electric | $540,000.00 | 222.20 | -$355.85 million | ($1.84) | -0.33 |
| REE Automotive | $180,000.00 | 70.34 | -$111.75 million | ($7.19) | -0.08 |
REE Automotive has lower revenue, but higher earnings than Faraday Future Intelligent Electric. Faraday Future Intelligent Electric is trading at a lower price-to-earnings ratio than REE Automotive, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Faraday Future Intelligent Electric and REE Automotive’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Faraday Future Intelligent Electric | -74,517.13% | -518.14% | -91.88% |
| REE Automotive | N/A | N/A | N/A |
Summary
REE Automotive beats Faraday Future Intelligent Electric on 7 of the 12 factors compared between the two stocks.
About Faraday Future Intelligent Electric
Faraday Future Intelligent Electric Inc. engages in the design, development, manufacture, engineering, sale, and distribution of electric vehicles and related products in the United States and internationally. The company was founded in 2014 and is headquartered in Gardena, California.
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.
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