Critical Survey: Canaan (NASDAQ:CAN) vs. Winland Electronics (OTCMKTS:WELX)

Winland Electronics (OTCMKTS:WELX) and Canaan (NASDAQ:CAN) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, dividends, profitability, valuation, risk and earnings.

Insider & Institutional Ownership

70.1% of Canaan shares are held by institutional investors. 8.1% of Winland Electronics shares are held by insiders. Comparatively, 0.3% of Canaan shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

Winland Electronics has a beta of 1.65, suggesting that its share price is 65% more volatile than the S&P 500. Comparatively, Canaan has a beta of 2.87, suggesting that its share price is 187% more volatile than the S&P 500.

Profitability

This table compares Winland Electronics and Canaan’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Winland Electronics	N/A	N/A	N/A
Canaan	-51.66%	-71.85%	-38.09%

Valuation & Earnings

This table compares Winland Electronics and Canaan”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Winland Electronics	$4.98 million	3.70	$5.91 million	$1.13	3.23
Canaan	$269.32 million	1.35	-$249.75 million	($0.68)	-1.44

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

Analyst Recommendations

This is a summary of current recommendations and price targets for Winland Electronics and Canaan, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Winland Electronics	0	0	0	0	0.00
Canaan	1	3	6	0	2.50

Canaan has a consensus price target of $3.68, suggesting a potential upside of 275.94%. Given Canaan’s stronger consensus rating and higher probable upside, analysts clearly believe Canaan is more favorable than Winland Electronics.

Summary

Winland Electronics beats Canaan on 8 of the 14 factors compared between the two stocks.

About Winland Electronics

Winland Holdings Corporation, through its subsidiaries, provides critical condition monitoring devices to the security industry. Its products are used to protect against loss of assets due to damage from water, excess humidity, extremes of temperature, and loss of power. The company offers EnviroAlert, which monitors temperature, humidity, and/or water presence in critical environments; TempAlert, a temperature monitoring device for residential and commercial environments through security systems; WaterBug, a water presence and leak detection system; and Power-Out Alert, a power outage detector. It also provides INSIGHT, an automated cloud-based platform that offers early alerting, reporting, and logging services designed to ensure regulatory compliance. The company offers its products through a network of distributors, dealers, security installers, and integrators for industries including health and medical, grocery and food services, and commercial and industrial, as well as agriculture and residential. Winland Holdings Corporation was incorporated in 1972 and is headquartered in Mankato, Minnesota.

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.