Head-To-Head Analysis: Lotus Technology (NASDAQ:LOT) versus Federal Signal (NYSE:FSS)

Lotus Technology (NASDAQ:LOT) and Federal Signal (NYSE:FSS) 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, profitability, dividends, risk, valuation, earnings and institutional ownership.

Risk and Volatility

Lotus Technology has a beta of 0.12, meaning that its stock price is 88% less volatile than the S&P 500. Comparatively, Federal Signal has a beta of 0.94, meaning that its stock price is 6% less volatile than the S&P 500.

Profitability

This table compares Lotus Technology and Federal Signal’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lotus Technology	N/A	N/A	-39.69%
Federal Signal	11.16%	18.31%	11.35%

Institutional & Insider Ownership

63.4% of Lotus Technology shares are held by institutional investors. Comparatively, 92.7% of Federal Signal shares are held by institutional investors. 0.2% of Lotus Technology shares are held by company insiders. Comparatively, 3.1% of Federal Signal shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Lotus Technology and Federal Signal”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lotus Technology	$947.09 million	0.36	-$742.00 million	($0.84)	-5.95
Federal Signal	$1.72 billion	3.09	$157.40 million	$2.96	29.39

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

Analyst Ratings

This is a breakdown of current recommendations and price targets for Lotus Technology and Federal Signal, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lotus Technology	0	1	0	0	2.00
Federal Signal	0	0	1	0	3.00

Lotus Technology presently has a consensus target price of $7.00, suggesting a potential upside of 40.00%. Given Lotus Technology’s higher probable upside, analysts clearly believe Lotus Technology is more favorable than Federal Signal.

Summary

Federal Signal beats Lotus Technology on 13 of the 14 factors compared between the two stocks.

About Lotus Technology

Lotus Technology Inc. engages in the design, development, and sale of battery electric lifestyle vehicles worldwide. It also distributes sports cars. The company sells its products under the Lotus brand. Lotus Technology Inc. is based in Shanghai, China.

About Federal Signal

Federal Signal Corp. engages in the design and manufacture of products and integrated solutions for municipal, governmental, industrial, and commercial customers. It operates through the Environmental Solutions Group and Safety and Security Systems Group segments. The Environment Solutions Group segment is involved in the manufacture and supply of street sweeper vehicles, sewer cleaners, vacuum loader trucks, hydro-excavation trucks, and water blasting equipment. The Safety and Security Systems Group segment offers comprehensive systems and products that law enforcement, fire rescue, emergency medical services, campuses, military facilities, and industrial sites use to protect people and property. The company was founded in 1901 and is headquartered in Oak Brook, IL.