Canadian Solar (NASDAQ:CSIQ) & Aeluma (NASDAQ:ALMU) Financial Analysis

Aeluma (NASDAQ:ALMU) and Canadian Solar (NASDAQ:CSIQ) are both small-cap technology companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, earnings, profitability, dividends, analyst recommendations, risk and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Aeluma and Canadian Solar, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aeluma	1	0	3	1	2.80
Canadian Solar	4	6	3	0	1.92

Aeluma presently has a consensus price target of $25.00, indicating a potential upside of 214.47%. Canadian Solar has a consensus price target of $16.42, indicating a potential upside of 67.40%. Given Aeluma’s stronger consensus rating and higher probable upside, analysts plainly believe Aeluma is more favorable than Canadian Solar.

Profitability

This table compares Aeluma and Canadian Solar’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Aeluma	-205.31%	-18.14%	-17.20%
Canadian Solar	-3.73%	-5.57%	-1.43%

Earnings & Valuation

This table compares Aeluma and Canadian Solar”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aeluma	$4.46 million	34.44	-$9.16 million	($0.52)	-15.29
Canadian Solar	$5.60 billion	0.12	-$104.13 million	($3.84)	-2.55

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

Volatility & Risk

Aeluma has a beta of 4.1, suggesting that its share price is 310% more volatile than the S&P 500. Comparatively, Canadian Solar has a beta of 1.53, suggesting that its share price is 53% more volatile than the S&P 500.

Institutional and Insider Ownership

52.4% of Canadian Solar shares are owned by institutional investors. 12.8% of Aeluma shares are owned by company insiders. Comparatively, 21.5% of Canadian Solar shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Aeluma beats Canadian Solar on 7 of the 13 factors compared between the two stocks.

About Aeluma

Aeluma, Inc. develops optoelectronic and electronic devices in the United States. The company manufactures semiconductor materials and chips using compound semiconductors on diameter substrates that are used to manufacture mass market microelectronics. It offers its devices for use in mobile, automotive, AI, defence and aerospace, communication, AR/VR, and HPC applications, as well as laser emitters, transistors for integrated circuits, quantum photonic circuits, and solar cells applications. Aeluma, Inc. was formerly known as Parc Investments, Inc. and changed its name to Aeluma, Inc. June 2021. The company was founded in 2019 and is headquartered in Goleta, California.

About Canadian Solar

Canadian Solar Inc., together with its subsidiaries, provides solar energy and battery energy storage products and solutions in in Asia, the Americas, Europe, and internationally. The company operates through two segments, CSI Solar and Recurrent Energy. The CSI Solar segment designs, develops, and manufactures solar ingots, wafers, cells, modules, and other solar power and battery storage products. It offers standard solar modules and battery storage solutions; solar system kits, such as inverters, racking systems, and other accessories; power electronic products; and engineering, procurement, and construction (EPC) services, as well as operates battery energy storage projects. The Recurrent Energy segment engages in the development, construction, maintenance, and sale of solar power and battery storage projects; and operation of solar power plants; and sale of electricity. This segment provides operation and maintenance (O&M) services, including monitoring, inspections, repair, and replacement of plant equipment; and site management and administrative support services for solar projects, as well as asset management services. It has a fleet of solar and battery energy storage plants in operation with an aggregate capacity of approximately 1,005 MWp and 600 MWh. It serves distributors, system integrators, project developers, and installers/EPC companies, as well as utility companies or grid operators, public utilities, licensed suppliers, corporate offtakers, and commercial, industrial or government end users. It sells its products primarily under its Canadian Solar brand name. Canadian Solar Inc. was incorporated in 2001 and is based in Guelph, Canada.