Head-To-Head Comparison: Valens Semiconductor (NYSE:VLN) vs. Canadian Solar (NASDAQ:CSIQ)

Valens Semiconductor (NYSE:VLN) and Canadian Solar (NASDAQ:CSIQ) are both small-cap computer and technology companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, earnings, risk, institutional ownership, dividends and valuation.

Risk and Volatility

Valens Semiconductor has a beta of 0.32, indicating that its share price is 68% less volatile than the S&P 500. Comparatively, Canadian Solar has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for Valens Semiconductor and Canadian Solar, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Valens Semiconductor	0	0	2	0	3.00
Canadian Solar	1	4	4	0	2.33

Valens Semiconductor currently has a consensus price target of $5.00, indicating a potential upside of 109.64%. Canadian Solar has a consensus price target of $31.78, indicating a potential upside of 110.17%. Given Canadian Solar’s higher possible upside, analysts clearly believe Canadian Solar is more favorable than Valens Semiconductor.

Insider & Institutional Ownership

33.9% of Valens Semiconductor shares are owned by institutional investors. Comparatively, 52.4% of Canadian Solar shares are owned by institutional investors. 58.9% of Valens Semiconductor 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 is poised for long-term growth.

Valuation and Earnings

This table compares Valens Semiconductor and Canadian Solar’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Valens Semiconductor	$84.16 million	2.95	-$19.66 million	($0.19)	-12.55
Canadian Solar	$7.88 billion	0.12	$274.19 million	$3.88	3.90

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Valens Semiconductor	-23.36%	-12.05%	-10.81%
Canadian Solar	3.60%	8.31%	2.47%

Summary

Canadian Solar beats Valens Semiconductor on 11 of the 14 factors compared between the two stocks.

About Valens Semiconductor

Valens Semiconductor Ltd. engages in the provision of semiconductor products for the audio-video and automotive industries. The company offers HDBaseT technology, which enables the simultaneous delivery of ultra-high-definition digital video and audio, Ethernet, USB, control signals, and power through a single long-reach cable. It also provides audio-video solutions for the enterprise, education, industrial, digital signage, industrial, and medical markets. In addition, it offers automotive chipsets that support advanced driver-assistance systems, automotive data solutions, infotainment, telematics, and backbone connectivity. The company's product series include VS100, VS2000, VS3000, VS6000, VS7000, Valens USB and power extender, Valens VS6320, USB 3.2 Gen1 extension chipset, VA6000, and VA7000. It has a collaboration with iCatch Technology to develop a 360-degree multi-camera videoconferencing solution. The company operates in Israel, China, Hong Kong, the United States, Japan, Germany, Hungary, and internationally. Valens Semiconductor Ltd. is headquartered in Hod Hasharon, Israel.

About Canadian Solar

Canadian Solar Inc., together with its subsidiaries, designs, develops, manufactures, and sells solar ingots, wafers, cells, modules, and other solar power and battery storage products in Asia, the Americas, Europe, and internationally. The company operates through two segments, Canadian Solar Inc. (CSI) Solar and Global Energy. The CSI Solar segment offers standard solar modules and battery storage solutions, as well as solar system kits that are a ready-to-install packages comprising inverters, racking systems, and other accessories; and engineering, procurement, and construction (EPC) services. The Global Energy segment engages in the development, construction, maintenance, and sale of solar and battery storage projects; operation of solar power plants; and sale of electricity. This segment also 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. As of January 31, 2023, this segment had a fleet of solar power plants in operation with an aggregate capacity of approximately 574 MWp. The company serves distributors, system integrators, project developers, and installers/EPC companies. It sells its products primarily under its Canadian Solar brand name; and on an OEM basis. Canadian Solar Inc. was incorporated in 2001 and is based in Guelph, Canada.