Head-To-Head Survey: Canaan (NASDAQ:CAN) vs. Monolithic Power Systems (NASDAQ:MPWR)

Canaan (NASDAQ:CAN) and Monolithic Power Systems (NASDAQ:MPWR) are both computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, valuation, dividends and profitability.

Volatility & Risk

Canaan has a beta of 3.24, indicating that its share price is 224% more volatile than the S&P 500. Comparatively, Monolithic Power Systems has a beta of 1.05, indicating that its share price is 5% more volatile than the S&P 500.

Profitability

This table compares Canaan and Monolithic Power Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Canaan	-128.85%	-60.37%	-42.71%
Monolithic Power Systems	21.29%	20.44%	16.93%

Earnings and Valuation

This table compares Canaan and Monolithic Power Systems”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Canaan	$229.63 million	2.84	-$414.15 million	($1.35)	-1.72
Monolithic Power Systems	$2.04 billion	14.19	$427.37 million	$8.87	66.88

Monolithic Power Systems has higher revenue and earnings than Canaan. Canaan is trading at a lower price-to-earnings ratio than Monolithic Power Systems, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings for Canaan and Monolithic Power Systems, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Canaan	0	1	3	0	2.75
Monolithic Power Systems	0	2	10	0	2.83

Canaan currently has a consensus price target of $3.00, indicating a potential upside of 29.31%. Monolithic Power Systems has a consensus price target of $828.67, indicating a potential upside of 39.69%. Given Monolithic Power Systems’ stronger consensus rating and higher probable upside, analysts clearly believe Monolithic Power Systems is more favorable than Canaan.

Institutional and Insider Ownership

70.1% of Canaan shares are owned by institutional investors. Comparatively, 93.5% of Monolithic Power Systems shares are owned by institutional investors. 0.3% of Canaan shares are owned by insiders. Comparatively, 3.7% of Monolithic Power Systems shares are owned 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.

Summary

Monolithic Power Systems beats Canaan on 13 of the 14 factors compared between the two stocks.

About Canaan

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 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 operations in the United States, Australia, Kazakhstan, Hong Kong, Canada, Mainland China, Thailand, Sweden, and internationally. Canaan Inc. was founded in 2013 and is based in Singapore.

About Monolithic Power Systems

Monolithic Power Systems, Inc. engages in the design, development, marketing, and sale of semiconductor-based power electronics solutions for the storage and computing, automotive, enterprise data, consumer, communications, and industrial markets. The company provides direct current (DC) to DC integrated circuits (ICs) that are used to convert and control voltages of various electronic systems, such as cloud-based CPU servers, server artificial intelligence applications, storage applications, commercial notebooks, digital cockpit, power sources, home appliances, 4G and 5G infrastructure, and satellite communications applications. It offers lighting control ICs for backlighting that are used in systems, which provide the light source for LCD panels in computers and notebooks, monitors, car navigation systems, and televisions, as well as for general illumination products. The company sells its products through third-party distributors, value-added resellers, directly to original equipment manufacturers, original design manufacturers, electronic manufacturing service providers, and other end customers. It serves China, Taiwan, South Korea, Europe, Japan, Southeast Asia, the United States, and internationally. Monolithic Power Systems, Inc. was incorporated in 1997 and is headquartered in Kirkland, Washington.