Critical Survey: ECARX (NASDAQ:ECX) and ARB IOT Group (NASDAQ:ARBB)

ECARX (NASDAQ:ECX) and ARB IOT Group (NASDAQ:ARBB) are both small-cap business services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, risk, earnings and valuation.

Valuation & Earnings

This table compares ECARX and ARB IOT Group’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ECARX	$657.10 million	0.70	-$132.42 million	($0.42)	-3.26
ARB IOT Group	$51.86 million	0.26	$5.53 million	N/A	N/A

ARB IOT Group has lower revenue, but higher earnings than ECARX.

Risk & Volatility

ECARX has a beta of 0.09, suggesting that its share price is 91% less volatile than the S&P 500. Comparatively, ARB IOT Group has a beta of 3.6, suggesting that its share price is 260% more volatile than the S&P 500.

Profitability

This table compares ECARX and ARB IOT Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ECARX	-21.18%	N/A	-25.16%
ARB IOT Group	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent ratings for ECARX and ARB IOT Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ECARX	0	0	0	0	N/A
ARB IOT Group	0	0	1	0	3.00

ARB IOT Group has a consensus target price of $8.00, suggesting a potential upside of 1,485.58%. Given ARB IOT Group’s higher possible upside, analysts clearly believe ARB IOT Group is more favorable than ECARX.

Insider & Institutional Ownership

14.8% of ARB IOT Group shares are owned by institutional investors. 20.0% of ECARX shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

ARB IOT Group beats ECARX on 7 of the 10 factors compared between the two stocks.

About ECARX

ECARX Holdings Inc. develops a full stack automotive computing platform to shape the interaction between people and cars by rapidly advancing the technology by smart mobility worldwide. It offers system on chips, central computing platforms, operating systems, and software. Its core products include infotainment head units, digital cockpits, vehicle chip-set solutions, core operating system, and integrated software stack. The company has entered into a strategic partnership agreement with Black Sesame Technologies. The company is based in Shanghai, the People's Republic of China.

About ARB IOT Group

ARB IOT Group Limited, through its subsidiaries, provides Internet of Things (IoT) system solutions, and system integration and support services in Malaysia. It offers IoT smart home and building solutions, such as design, procurement, and provision of smart home products and devices; integration services; and electrical wire installation and home data network setup for homeowners, as well as provides smart building solutions, including design, procurement, installation, testing, pre-commissioning and commissioning of various IoT systems, solutions, and devices; and integration of automated systems for smart buildings, including installation of wire and wireless, and mechatronic works for property developers and contractors. The company offers IoT smart agriculture solutions, such as designing the layout of the smart farm for the application and integration of IoT in farming and hydroponics, which includes the procurement of sensors and surveillance cameras, as well as other hardware for farm; designing of software to enable transfer of data from the smart farm to a cloud server, which can then be accessed remotely through smart devices; installing, testing, and commissioning of the hardware and software; and after-sales services comprising data analytics and periodic maintenance services. In addition, it provides IoT system development solutions, including procuring, supplying, and delivering industrial building systems for construction projects; and IoT gadget distribution solutions comprising supply chain and distribution of smart phones, accessories, and ICT and IoT products, as well as provides shipping tracking and status updates, customer care line, online chat support, digital marketing, pre-installation, and warranty services. The company was incorporated in 2022 and is based in Kuala Lumpur, Malaysia. ARB IOT Group Limited is a subsidiary of ARB Berhad.