Tower Semiconductor (NASDAQ:TSEM – Get Rating) and Canaan (NASDAQ:CAN – Get Rating) are both computer and technology companies, but which is the better business? We will compare the two companies based on the strength of their risk, analyst recommendations, earnings, profitability, institutional ownership, dividends and valuation.
Risk and Volatility
Tower Semiconductor has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500. Comparatively, Canaan has a beta of 3.22, suggesting that its stock price is 222% more volatile than the S&P 500.
This table compares Tower Semiconductor and Canaan’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Tower Semiconductor presently has a consensus price target of $45.50, indicating a potential upside of 3.50%. Canaan has a consensus price target of $7.67, indicating a potential upside of 183.95%. Given Canaan’s stronger consensus rating and higher possible upside, analysts plainly believe Canaan is more favorable than Tower Semiconductor.
Insider & Institutional Ownership
16.7% of Canaan shares are held by institutional investors. 1.0% of Tower Semiconductor shares are held by company insiders. Comparatively, 0.3% of Canaan shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares Tower Semiconductor and Canaan’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Tower Semiconductor||$1.51 billion||3.19||$150.01 million||$2.11||20.83|
|Canaan||$782.52 million||0.65||$313.89 million||$2.06||1.31|
Canaan has lower revenue, but higher earnings than Tower Semiconductor. Canaan is trading at a lower price-to-earnings ratio than Tower Semiconductor, indicating that it is currently the more affordable of the two stocks.
Canaan beats Tower Semiconductor on 9 of the 14 factors compared between the two stocks.
About Tower Semiconductor
Tower Semiconductor Ltd., an independent semiconductor foundry, manufactures and markets analog intensive mixed-signal semiconductor devices in the United States, Japan, other Asia countries, and Europe. It provides various customizable process technologies, including SiGe, BiCMOS, mixed signal/CMOS, RF CMOS, CMOS image sensor, integrated power management, and MEMS. The company also offers wafer fabrication services and design enablement platform for design cycle, as well as transfer optimization and development process services to integrated device manufacturers and fabless companies. It serves various markets, such as consumer electronics, personal computers, communications, automotive, industrial, aerospace, military, and medical device products. The company was incorporated in 1993 and is headquartered in Migdal Haemek, Israel.
Canaan Inc. engages in the research, design, and sale of integrated circuit (IC) final mining equipment products by integrating IC products for bitcoin mining and related components primarily in the People's Republic of China. It is also involved in the assembly and distribution of mining equipment and spare parts. The company has a strategic cooperation with Northern Data AG in the areas of artificial intelligence development, blockchain technology, and datacenter operations. Canaan Inc. was founded in 2013 and is based in Beijing, the People's Republic of China.
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