Contrasting Ideal Power (NASDAQ:IPWR) and Pixelworks (NASDAQ:PXLW)

Ideal Power (NASDAQ:IPWR) and Pixelworks (NASDAQ:PXLW) are both small-cap industrial products companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, profitability, dividends, valuation, risk, earnings and institutional ownership.

Volatility & Risk

Ideal Power has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500. Comparatively, Pixelworks has a beta of 1.61, meaning that its share price is 61% more volatile than the S&P 500.

Profitability

This table compares Ideal Power and Pixelworks’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ideal Power	-7,138.19%	-62.80%	-55.62%
Pixelworks	-42.77%	-72.81%	-26.40%

Institutional & Insider Ownership

16.4% of Ideal Power shares are held by institutional investors. Comparatively, 21.4% of Pixelworks shares are held by institutional investors. 5.0% of Ideal Power shares are held by insiders. Comparatively, 4.7% of Pixelworks shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Ideal Power and Pixelworks”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ideal Power	$200,000.00	299.91	-$9.95 million	($1.53)	-5.10
Pixelworks	$60.70 million	0.65	-$26.18 million	($0.45)	-1.50

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

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Ideal Power and Pixelworks, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ideal Power	0	0	1	0	3.00
Pixelworks	0	0	3	0	3.00

Ideal Power currently has a consensus target price of $14.00, suggesting a potential upside of 79.49%. Pixelworks has a consensus target price of $2.33, suggesting a potential upside of 245.12%. Given Pixelworks’ higher possible upside, analysts plainly believe Pixelworks is more favorable than Ideal Power.

Summary

Pixelworks beats Ideal Power on 9 of the 13 factors compared between the two stocks.

About Ideal Power

Ideal Power Inc. focuses on the development and commercialization of its bidirectional bipolar junction TRANsistor solid-state switch technology. It also offers SymCool Power Module designed to meet low conduction loss needs of the solid-state circuit breaker market. The company serves electric and hybrid electric vehicles, electric vehicle charging, renewable energy and energy storage system power converters, uninterruptible power supplies for data centers, industrial motor drives, solid-state circuit breakers, distribution and transmission switches and controls, and other industrial and military markets. The company was formerly known as Ideal Power Converters Inc. and changed its name to Ideal Power Inc. in July 2013. Ideal Power Inc. was incorporated in 2007 and is headquartered in Austin, Texas.

About Pixelworks

Pixelworks, Inc., together with its subsidiaries, develops and markets semiconductor and software solutions for mobile, home and enterprise, and cinema markets in the United States, Japan, China, Taiwan, Korea, and Europe. The company offers imageprocessor integrated circuits, such as embedded microprocessors, digital signal processing technology, and software that control the operations and signal processing within high-end display systems; visual processor integrated circuits that works with a mobile application processor; and transcoder integrated circuits which includes software that control the operations and signal processing for converting multiple bitrates, resolutions and codecs to provide bandwidth efficient video transmissions based on industry standard protocols. It also provides software and platform licensing products comprising Pixelworks Pro Software, a software that enables development and customize the look and feel of mobile products by use of various features, such as absolute color accuracy, HDR tone mapping, SDR-to-HDR conversion, and others; and TrueCut Motion Platform, content creation tool which provides the ability to dial in a motion look on a shot-by-shot basis. The company distributes its products to integrators, branded manufacturers, and branded suppliers. Pixelworks, Inc. was founded in 1997 and is based in Portland, Oregon.