Pure Cycle Corporation (NASDAQ: PCYO) and AquaVenture Holdings (NYSE:WAAS) are both small-cap utilities companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, valuation, analyst recommendations, profitability, risk, earnings and institutional ownership.
Institutional and Insider Ownership
69.8% of Pure Cycle Corporation shares are held by institutional investors. Comparatively, 38.8% of AquaVenture Holdings shares are held by institutional investors. 4.6% of Pure Cycle Corporation shares are held by insiders. Comparatively, 55.9% of AquaVenture Holdings shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This is a breakdown of recent recommendations for Pure Cycle Corporation and AquaVenture Holdings, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Pure Cycle Corporation||0||0||1||0||3.00|
AquaVenture Holdings has a consensus price target of $22.00, indicating a potential upside of 42.58%. Given AquaVenture Holdings’ stronger consensus rating and higher possible upside, analysts plainly believe AquaVenture Holdings is more favorable than Pure Cycle Corporation.
Earnings and Valuation
This table compares Pure Cycle Corporation and AquaVenture Holdings’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Pure Cycle Corporation||$1.22 million||136.27||-$1.71 million||($0.07)||-99.99|
|AquaVenture Holdings||$114.10 million||3.58||-$20.47 million||($1.01)||-15.28|
Pure Cycle Corporation has higher revenue, but lower earnings than AquaVenture Holdings. Pure Cycle Corporation is trading at a lower price-to-earnings ratio than AquaVenture Holdings, indicating that it is currently the more affordable of the two stocks.
This table compares Pure Cycle Corporation and AquaVenture Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Pure Cycle Corporation||-139.44%||-2.48%||-2.40%|
AquaVenture Holdings beats Pure Cycle Corporation on 7 of the 13 factors compared between the two stocks.
About Pure Cycle Corporation
Pure Cycle Corporation is an integrated water company that provides wholesale water and wastewater services. The Company provides its services to wholesale customers, which include industrial customers and local governmental entities that provide water and wastewater services to their end-use customers located in the Denver, Colorado metropolitan area. The Company is engaged in selling water service to customers, using water rights owned or controlled by the Company and developing infrastructure to divert, treat and distribute that water and collect, treat and reuse wastewater. The Company owns a portfolio of water rights located in the Denver, Colorado metropolitan area, Southeastern Colorado in the Arkansas River, and the Western Slope of Colorado in the Colorado River. The Company’s Denver area assets include Rangeview Water, the Lowry Range Property, Sky Ranch and Arapahoe County Fairgrounds.
About AquaVenture Holdings
AquaVenture Holdings Limited is a multinational provider of Water-as-a-Service solutions. The Company’s segments are Seven Seas Water and Quench. The Seven Seas Water segment provides outsourced desalination solutions and wastewater treatment for governmental, municipal, industrial and hospitality customers. The Quench segment provides bottleless filtered water coolers and other products that use filtered water as an input, such as ice machines, sparkling water dispensers and coffee brewers, to customers throughout the United States typically under multi-year contracts. The Company’s solutions utilize seawater reverse osmosis and other purification technologies to produce potable and industrial process water in high volumes for customers operating in regions with limited access to potable water. As of December 31, 2016, it operated 10 water treatment facilities in the Caribbean region and South America producing approximately eight billion gallons of purified water per year.
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