Analyzing AU Optronics (AUO) & ReneSola (SOL)

AU Optronics (NYSE: AUO) and ReneSola (NYSE:SOL) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, dividends, risk, institutional ownership, profitability, analyst recommendations and valuation.

Earnings and Valuation

This table compares AU Optronics and ReneSola’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AU Optronics $11.51 billion 0.35 $1.40 billion $1.13 3.73
ReneSola $102.97 million 0.90 $34.45 million $0.13 18.62

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

Volatility and Risk

AU Optronics has a beta of 0.8, suggesting that its share price is 20% less volatile than the S&P 500. Comparatively, ReneSola has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for AU Optronics and ReneSola, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AU Optronics 1 2 1 0 2.00
ReneSola 0 1 0 0 2.00

ReneSola has a consensus target price of $2.00, suggesting a potential downside of 17.36%. Given ReneSola’s higher possible upside, analysts plainly believe ReneSola is more favorable than AU Optronics.

Profitability

This table compares AU Optronics and ReneSola’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AU Optronics 5.87% 8.53% 4.30%
ReneSola N/A N/A N/A

Dividends

AU Optronics pays an annual dividend of $0.37 per share and has a dividend yield of 8.8%. ReneSola does not pay a dividend. AU Optronics pays out 32.7% of its earnings in the form of a dividend.

Insider and Institutional Ownership

6.6% of AU Optronics shares are held by institutional investors. Comparatively, 10.2% of ReneSola shares are held by institutional investors. 16.0% of AU Optronics shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

AU Optronics beats ReneSola on 9 of the 14 factors compared between the two stocks.

About AU Optronics

AU Optronics Corp. researches, develops, produces, and sells thin film transistor liquid crystal displays and other flat panel displays. The company operates through two segments, Display and Solar. The Display segment designs, develops, manufactures, assembles, and markets flat panel displays for use in televisions (TVs), TV sets, and other related products; desktop monitors; mobile PCs, such as notebooks and tablets; mobile phones; and commercial and other applications, including displays for automobiles, industrial PCs, automated teller machines, point of sale terminals, pachinko machines, medical equipment, and others. This segment serves original equipment manufacturing service providers; and brand companies. The Solar segment manufactures and sells solar materials, including ingots, solar wafers, and solar modules, as well as provides technical engineering and maintenance services for solar system projects. This segment sells its ingot and solar wafer products primarily to solar cell manufacturers; and solar modules to installers, solar system integrators, property developers, and other value-added resellers. The company also engages in the renewable energy power generation; repairing and sale support of TFT-LCD modules, as well as sale support of solar-related products; injecting and stamping parts; manufacture and sale of molds, light guide plates, liquid crystal products, backlight modules, and related parts, as well as precision plastic and metal parts; IP related business; design, development and sales of software and hardware for health care industry; manufacture, assembly, and sale of automotive parts; manufacture and sale of motorized treadmills; and planning, design, and development of construction for environmental protection and related project management. It operates in the People's Republic of China, Taiwan, Japan, Singapore, and internationally. AU Optronics Corp. was founded in 1996 and is headquartered in Hsinchu, Taiwan.

About ReneSola

ReneSola Ltd, through its subsidiaries, develops, builds, operates, and sells solar power projects. It operates through three segments: solar power project development, EPC services, and electricity revenue generation. The company also develops community solar gardens; and sells projects rights. In addition, its engineering, and procurement and construction business includes engineering design, procurement of solar modules, balance-of-system and other components, and construction contracting and management services. Further, the company generates and sells electricity. As of February 28, 2018, it operated approximately 80 solar power projects with an aggregate capacity of 212 MW. The company was founded in 2005 and is based in Shanghai, the People's Republic of China.

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