Analyzing Power Integrations (NASDAQ:POWI) and JinkoSolar (NYSE:JKS)

JinkoSolar (NYSE:JKS) and Power Integrations (NASDAQ:POWI) are both oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, analyst recommendations, profitability, institutional ownership and valuation.

Valuation and Earnings

This table compares JinkoSolar and Power Integrations’ revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
JinkoSolar	$16.72 billion	0.07	$485.56 million	$6.41	3.23
Power Integrations	$444.54 million	8.96	$55.74 million	$0.92	76.29

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

Volatility & Risk

JinkoSolar has a beta of 0.44, indicating that its share price is 56% less volatile than the S&P 500. Comparatively, Power Integrations has a beta of 1.18, indicating that its share price is 18% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and target prices for JinkoSolar and Power Integrations, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
JinkoSolar	1	5	0	0	1.83
Power Integrations	0	2	3	0	2.60

JinkoSolar presently has a consensus target price of $26.60, indicating a potential upside of 28.32%. Power Integrations has a consensus target price of $87.40, indicating a potential upside of 24.52%. Given JinkoSolar’s higher possible upside, research analysts clearly believe JinkoSolar is more favorable than Power Integrations.

Insider & Institutional Ownership

35.8% of JinkoSolar shares are held by institutional investors. 19.8% of JinkoSolar shares are held by company insiders. Comparatively, 1.7% of Power Integrations shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares JinkoSolar and Power Integrations’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
JinkoSolar	2.74%	11.12%	2.81%
Power Integrations	12.28%	6.13%	5.57%

Dividends

JinkoSolar pays an annual dividend of $1.48 per share and has a dividend yield of 7.1%. Power Integrations pays an annual dividend of $0.80 per share and has a dividend yield of 1.1%. JinkoSolar pays out 23.1% of its earnings in the form of a dividend. Power Integrations pays out 87.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Power Integrations has increased its dividend for 11 consecutive years. JinkoSolar is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

JinkoSolar beats Power Integrations on 9 of the 17 factors compared between the two stocks.

About JinkoSolar

JinkoSolar Holding Co., Ltd., together with its subsidiaries, engages in the design, development, production, and marketing of photovoltaic products. The company offers solar modules, silicon wafers, solar cells, recovered silicon materials, and silicon ingots. It also provides solar system integration services; solar power generation and solar system EPC services; and energy storage system, as well as undertakes solar power projects. The company sells its products to distributors, project developers, system integrators, and manufacturers of solar power products under the JinkoSolar brand. As of December 31, 2023, it had an integrated annual capacity of 85 gigawatts (GW) for mono wafers; 90 GW for solar cells; and 110 GW for solar modules. It operates in China, the United States, Mexico, Australia, Japan, the United Arab Emirates, Turkey, Jordan, Vietnam, Egypt, Spain, Germany, and internationally. JinkoSolar Holding Co., Ltd. was founded in 2006 and is headquartered in Shangrao, the People's Republic of China.

About Power Integrations

Power Integrations, Inc. designs, develops, manufactures, and markets analog and mixed-signal integrated circuits (ICs), and other electronic components and circuitry used in high-voltage power conversion worldwide. The company provides a range of alternating current to direct current power conversion products that address power supply ranging from less than one watt of output to approximately 500 watts of output for mobile-device chargers, consumer appliances, utility meters, LCD monitors, main and standby power supplies for desktop computers and TVs, LED lighting, and various other consumer and industrial applications, as well as power conversion in high-power applications comprising industrial motors, solar and wind-power systems, electric vehicles, and high-voltage DC transmission systems. It also offers high-voltage diodes; InnoSwitch IC for electric vehicles; high-voltage gate-driver products used to operate high-voltage switches, such as insulated-gate bipolar transistors and silicon-carbide MOSFETs under the SCALE and SCALE-2 product-family names; and SCALE-iDriver for use in powertrain and charging applications for electric vehicles. In addition, the company provides motor-driver ICs for use in refrigerator compressors, ceiling fans, and air purifiers, as well as pumps, fans, and blowers used in consumer appliances, such as dishwashers and laundry machines. It serves communications, computer, consumer, and industrial markets. The company sells its products to original equipment manufacturers and merchant power supply manufacturers through direct sales staff, as well as a network of independent sales representatives and distributors. Power Integrations, Inc. was incorporated in 1988 and is headquartered in San Jose, California.