Financial Comparison: Alpha and Omega Semiconductor (NASDAQ:AOSL) and Canadian Solar (NASDAQ:CSIQ)

Canadian Solar (NASDAQ:CSIQ) and Alpha and Omega Semiconductor (NASDAQ:AOSL) are both small-cap oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.

Risk and Volatility

Canadian Solar has a beta of 1.29, suggesting that its share price is 29% more volatile than the S&P 500. Comparatively, Alpha and Omega Semiconductor has a beta of 2.42, suggesting that its share price is 142% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Canadian Solar	0.56%	0.99%	0.31%
Alpha and Omega Semiconductor	-1.69%	-0.33%	-0.25%

Insider and Institutional Ownership

52.4% of Canadian Solar shares are held by institutional investors. Comparatively, 79.0% of Alpha and Omega Semiconductor shares are held by institutional investors. 21.5% of Canadian Solar shares are held by insiders. Comparatively, 17.9% of Alpha and Omega Semiconductor shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Canadian Solar and Alpha and Omega Semiconductor”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Canadian Solar	$6.51 billion	0.15	$274.19 million	$2.88	4.98
Alpha and Omega Semiconductor	$657.27 million	1.58	-$11.08 million	($0.34)	-106.12

Canadian Solar has higher revenue and earnings than Alpha and Omega Semiconductor. Alpha and Omega 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.

Analyst Ratings

This is a summary of current ratings and recommmendations for Canadian Solar and Alpha and Omega Semiconductor, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Canadian Solar	2	4	4	0	2.20
Alpha and Omega Semiconductor	1	0	2	0	2.33

Canadian Solar presently has a consensus price target of $23.33, indicating a potential upside of 62.68%. Alpha and Omega Semiconductor has a consensus price target of $42.67, indicating a potential upside of 18.26%. Given Canadian Solar’s higher possible upside, analysts clearly believe Canadian Solar is more favorable than Alpha and Omega Semiconductor.

Summary

Canadian Solar beats Alpha and Omega Semiconductor on 10 of the 14 factors compared between the two stocks.

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.

About Alpha and Omega Semiconductor

Alpha and Omega Semiconductor Limited designs, develops, and supplies power semiconductor products for computing, consumer electronics, communication, and industrial applications in Hong Kong, China, South Korea, the United States, and internationally. It offers power discrete products, including metal-oxide-semiconductor field-effect transistors (MOSFET), SRFETs, XSFET, electrostatic discharge, protected MOSFETs, high and mid-voltage MOSFETs, and insulated gate bipolar transistors for use in smart phone chargers, battery packs, notebooks, desktop and servers, data centers, base stations, graphics card, game boxes, TVs, AC adapters, power supplies, motor control, power tools, E-vehicles, white goods and industrial motor drives, UPS systems, solar inverters, and industrial welding. The company also provides power ICs that deliver power, as well as control and regulate the power management variables, such as the flow of current and level of voltage. Its power ICs are used in flat panel displays, TVs, notebooks, graphic cards, servers, DVD/Blu-Ray players, set-top boxes, and networking equipment. In addition, the company offers transient voltage suppressors, analog switch, and electromagnetic interference filter for notebooks, desktop PCs, tablets, flat panel displays, TVs, smart phones, and portable electronic devices; and 650V and 1200V SiC MOSFET. Alpha and Omega Semiconductor Limited was incorporated in 2000 and is headquartered in Sunnyvale, California.