Financial Analysis: WISeKey International (NASDAQ:WKEY) & Eastern (NASDAQ:EML)

Eastern (NASDAQ:EML) and WISeKey International (NASDAQ:WKEY) are both small-cap industrials companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, valuation, dividends, institutional ownership and earnings.

Institutional and Insider Ownership

77.0% of Eastern shares are held by institutional investors. Comparatively, 0.3% of WISeKey International shares are held by institutional investors. 17.0% of Eastern shares are held by company insiders. Comparatively, 33.5% of WISeKey International shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Eastern and WISeKey International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eastern	-3.01%	10.22%	5.25%
WISeKey International	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Eastern and WISeKey International, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eastern	0	0	0	0	0.00
WISeKey International	0	0	1	0	3.00

WISeKey International has a consensus target price of $4.00, indicating a potential downside of 31.27%. Given WISeKey International’s stronger consensus rating and higher possible upside, analysts clearly believe WISeKey International is more favorable than Eastern.

Valuation & Earnings

This table compares Eastern and WISeKey International”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eastern	$272.75 million	0.53	-$8.53 million	($1.32)	-17.76
WISeKey International	$11.88 million	4.00	-$13.45 million	N/A	N/A

Eastern has higher revenue and earnings than WISeKey International.

Risk and Volatility

Eastern has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500. Comparatively, WISeKey International has a beta of 1.51, suggesting that its share price is 51% more volatile than the S&P 500.

Summary

WISeKey International beats Eastern on 7 of the 12 factors compared between the two stocks.

About Eastern

The Eastern Company designs, manufactures, and sells engineered solutions to industrial markets in the United States and internationally. The company offers turnkey returnable packaging solutions, which are used in the assembly processes of vehicles, aircraft, and durable goods, as well as in production processes of plastic packaging products, packaged consumer goods, and pharmaceuticals; designs and manufactures blow mold tools and injection blow mold tooling products, and 2-step stretch blow molds and related components for the stretch blow molding industry; and supplies blow molds and change parts to the food, beverage, healthcare, and chemical industries. It also provides rotary latches, compression latches, draw latches, hinges, camlocks, key switches, padlocks, and handles; and development and program management services for custom electromechanical and mechanical systems for original equipment manufacturers (OEMs) and customer applications. In addition, the company designs and manufactures proprietary vision technology for OEMs and aftermarket applications, as well as offers aftermarket components to the heavy- and medium-duty truck, motorhome, and bus markets. The Eastern Company was founded in 1858 and is based in Shelton, Connecticut.

About WISeKey International

WISeKey International Holding AG, a cybersecurity company, provides integrated security solutions in Switzerland, rest of Europe, the Middle East, Africa, North America, the Asia Pacific, and Latin America. The company operates in two segments, IoT and Managed Public Key Infrastructure (mPKI). It offers microcontrollers that provides identity to various connected devices; and mPKI, which include digital identity, certificate management and signing solutions, and trust services, as well as offers digital certificates; software as a service, including cloud-based certificate life-cycle-management and signing and authentication solutions; software licenses; post-contract customer support for cybersecurity applications; and infrastructure hosting and monitoring services. The company also develops, markets, hosts, and supports a range of solutions that enable secure digital identification of people, content, and objects by generating digital identities through its products and services in cybersecurity services, IoT, digital brand management, and mobile security, which enable clients to monetize their existing user bases, as well as expand its eco-system. In addition, it engages in financing, sales, and distribution activities; and sells semiconductors secure chips. The company was founded in 1999 and is headquartered in Zug, Switzerland.