Volcon (NASDAQ:EMPD) versus NIO (NYSE:NIO) Critical Analysis

Volcon (NASDAQ:EMPD) and NIO (NYSE:NIO) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.

Profitability

This table compares Volcon and NIO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Volcon	-43,296.70%	-58.08%	-45.39%
NIO	-3.95%	-111.37%	-3.62%

Valuation & Earnings

This table compares Volcon and NIO”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Volcon	$980,000.00	88.79	-$150.05 million	($1.05)	-2.94
NIO	$12.51 billion	0.68	-$2.14 billion	($0.27)	-12.65

Volcon has higher earnings, but lower revenue than NIO. NIO is trading at a lower price-to-earnings ratio than Volcon, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and recommmendations for Volcon and NIO, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Volcon	1	1	1	1	2.50
NIO	2	7	6	0	2.27

Volcon presently has a consensus price target of $6.00, indicating a potential upside of 94.17%. NIO has a consensus price target of $5.87, indicating a potential upside of 71.79%. Given Volcon’s stronger consensus rating and higher possible upside, analysts clearly believe Volcon is more favorable than NIO.

Insider and Institutional Ownership

48.5% of NIO shares are held by institutional investors. 0.1% of Volcon shares are held by insiders. Comparatively, 1.0% of NIO shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Risk and Volatility

Volcon has a beta of -0.35, suggesting that its share price is 135% less volatile than the S&P 500. Comparatively, NIO has a beta of 0.92, suggesting that its share price is 8% less volatile than the S&P 500.

Summary

NIO beats Volcon on 8 of the 15 factors compared between the two stocks.

About Volcon

Volcon, Inc. develops, manufactures, and sells electric off road powersport vehicles in the United States. It provides electric two and four-wheel motorcycles, and utility terrain vehicles through its dealers. The company also offers a line of upgrades and accessories. Its products are designed for family off-road adventures, and work on the farm and fun transport around private land applications. The company was formerly known as Frog ePowersports, Inc. and changed its name to Volcon, Inc. in October 2020. Volcon, Inc. was incorporated in 2020 and is based in Round Rock, Texas.

About NIO

NIO Inc. designs, manufactures, and sells electric vehicles in the People's Republic of China. The company is also involved in the manufacture of e-powertrain, battery packs, and components; and racing management, technology development, and sales and after-sales management activities. In addition, it offers power solutions for battery charging needs; and other value-added services. The company was formerly known as NextEV Inc. and changed its name to NIO Inc. in July 2017. NIO Inc. was founded in 2014 and is headquartered in Shanghai, the People's Republic of China.