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Canaan (CAN)
NASDAQ:CAN
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Canaan
(NASDAQ:CAN)
Rating:44Neutral
Price Target:
$0.50
▼(-28.57%Downside)
Positive Factors
Growth Potential
Efforts to develop next-generation bitcoin mining equipment and expand global hash rate suggest promising growth potential for Canaan Inc.
Share Buyback
The company's board of directors has approved a $30 million stock buyback program, which could support the share price.
Undervaluation
Canaan Inc.'s bitcoin holdings and net cash exceed its current market capitalization, indicating a potential undervaluation of its stock.
Negative Factors
Market Pressure
The imposition of tariffs by the U.S. government impacted Canaan Inc.'s customer order flow and delayed its self-mining deployments in the U.S.
Regulatory Challenges
Canaan Inc. faces uncertainty due to U.S. tariffs impacting demand for its bitcoin mining equipment and a Nasdaq delisting notice for trading below $1.00.
Canaan (CAN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$199.24M
Dividend YieldN/A
Average Volume (3M)31.81M
Price to Earnings (P/E)―
Beta (1Y)1.56
Revenue Growth65.68%
EPS Growth50.28%
CountryUS
Employees463
SectorTechnology
Sector Strength87
IndustryComputer Hardware
Share Statistics
EPS (TTM)-0.27
Shares Outstanding399,488,600
10 Day Avg. Volume22,960,244
30 Day Avg. Volume31,813,727
Financial Highlights & Ratios
PEG Ratio0.05
Price to Book (P/B)0.78
Price to Sales (P/S)0.00
P/FCF Ratio-1.62
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$2.88Price Target Upside311.43% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Canaan Business Overview & Revenue Model
Company DescriptionCanaan Inc. is a leading technology company that specializes in providing high-performance computing solutions. The company is primarily known for its development and production of advanced blockchain servers and ASIC microprocessor solutions, which are integral to the cryptocurrency mining sector. In addition to its core focus on cryptocurrency mining hardware, Canaan is also involved in the development of artificial intelligence (AI) applications and services.
How the Company Makes MoneyCanaan Inc. generates revenue primarily through the sale of its proprietary blockchain servers and ASIC microprocessors, which are used by customers to mine cryptocurrencies such as Bitcoin. The company's revenue model is heavily reliant on the demand for cryptocurrency mining equipment, which fluctuates based on market conditions and cryptocurrency prices. Canaan also explores additional revenue streams through its ventures into AI development, though this segment currently represents a smaller portion of its overall revenue. The company's earnings are influenced by its ability to maintain competitive pricing, technological advancements in its products, and strategic partnerships within the tech and crypto industries.
Canaan Earnings Call Summary
Earnings Call Date:May 20, 2025
(Q1-2025)
| % Change Since: -14.63%|
Next Earnings Date:Aug 14, 2025
Earnings Call Sentiment Neutral
The earnings call reflected strong revenue growth and successful product launches, particularly in non-US markets. However, significant challenges were noted due to tariff impacts and bitcoin price volatility, leading to strategic caution and withdrawal of full-year guidance.Q1-2025 Updates
Positive Updates
Record Revenue Growth
Total revenues for Q1 2025 reached $82.8 million, surpassing the previous guidance of $75 million, marking a 136% year-over-year increase.
Strong Performance in Mining Operations
The self-mining business delivered 259 bitcoins, up 39% quarter-over-quarter, with mining revenue reaching over $24 million, a 59% sequential increase.
Successful Launch and Sales of A15 Series
The A15 series contributed significantly to sales, achieving 5.5 exahash per second in total computing power sold, up 62.6% year-over-year.
Negative Updates
Impact of Tariffs on US Market
US tariffs on imports, including a 10% universal tariff, have led to higher mining costs and decreased demand for mining machines in the US.
Volatility in Bitcoin Prices
Bitcoin prices fluctuated significantly, dropping from $104,000 to $76,000, before rebounding to around $85,000, affecting miners' profit margins.
Withdrawal of Full-Year Revenue Guidance
Due to ongoing global political and economic volatility, the company has withdrawn its previously issued full-year revenue guidance.
Company Guidance
During the first quarter of 2025, Canaan Inc. faced significant challenges due to macroeconomic factors, including rising tariffs and volatile bitcoin prices. Despite these hurdles, the company reported revenues of $82.8 million, surpassing their guidance of $75 million and marking a 136% year-over-year increase. Their self-mining business produced 259 bitcoins, contributing to a mining revenue of over $24 million, a 59% sequential increase, supported by a competitive electricity cost of $4.2 per kilowatt hour. The average selling price per terahash rose by 30% sequentially to $10.5, driven by the high performance A15 series, which accounted for $45 million of the mining machine sales and 3.9 million terahash per second in computing power sold. However, due to the ongoing tariff uncertainty, Canaan withdrew its full-year revenue guidance and hash rate deployment targets, projecting a cautious revenue of $100 million for Q2 2025.Canaan Financial Statement Overview
Summary
Canaan faces significant financial challenges, with consistent losses, negative cash flows, and fluctuating revenue. The company's manageable debt load is overshadowed by negative profit margins and cash flow trends, suggesting operational inefficiencies and strategic hurdles.Income Statement
Canaan has experienced significant revenue fluctuations over the years, marked by a decline from 2019 to 2023. The gross profit margin has consistently been negative, indicating challenges in covering production costs. The net profit margin is also negative, reflecting ongoing losses. Despite a brief positive turn in 2021, recent years have shown negative EBIT and EBITDA margins, highlighting persistent operational inefficiencies.25
Negative
Balance Sheet
The company's debt-to-equity ratio remains relatively low, suggesting manageable leverage levels. However, the equity ratio has decreased over recent years, indicating shrinking equity relative to assets. Return on equity is negative, reflecting the company's inability to generate profits from shareholders' equity. Despite these challenges, the balance sheet shows some liquidity strength with cash reserves.40
Negative
Cash Flow
Canaan's cash flow analysis reveals negative trends in operating and free cash flow, indicating challenges in generating cash from core operations. The free cash flow to net income ratio is negative, consistent with the company's net losses. While financing activities have provided liquidity, the negative growth in free cash flow raises concerns about long-term sustainability.30
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 317.01M | 269.32M | 211.48M | 656.32M | 771.14M | 68.58M |
| Gross Profit | -46.35M | -84.32M | -240.78M | 231.98M | 440.83M | 5.79M |
| EBITDA | -204.84M | -143.33M | -330.11M | 84.51M | 285.16M | -34.11M |
| Net Income | -296.79M | -249.75M | -414.15M | 70.40M | 308.44M | -32.95M |
Balance Sheet | ||||||
| Total Assets | 565.55M | 463.01M | 493.30M | 690.00M | 884.74M | 158.76M |
| Cash, Cash Equivalents and Short-Term Investments | 96.77M | 96.49M | 96.15M | 105.65M | 421.67M | 69.50M |
| Total Debt | 231.02M | 94.99M | 1.43M | 1.45M | 2.56M | 5.83M |
| Total Liabilities | 320.92M | 196.76M | 145.11M | 77.86M | 341.44M | 92.50M |
| Stockholders Equity | 244.64M | 266.25M | 348.19M | 612.13M | 543.31M | 66.26M |
Cash Flow | ||||||
| Free Cash Flow | -105.39M | -218.57M | -126.93M | -201.82M | 196.23M | 6.15M |
| Operating Cash Flow | -89.00M | -199.26M | -123.62M | -183.94M | 201.86M | 6.48M |
| Investing Cash Flow | 25.33M | 60.97M | 39.63M | ― | 846.22K | ― |
| Financing Cash Flow | 81.97M | 139.75M | 90.00M | -56.59M | 138.93M | -17.15M |
Canaan Technical Analysis
Neutral
0.70
Price Trends
0.69
Positive
0.91
Negative
1.30
Negative
Market Momentum
-0.01
Negative
55.23
Neutral
54.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CAN, the sentiment is Neutral. The current price of 0.7 is above the 20-day moving average (MA) of 0.65, above the 50-day MA of 0.69, and below the 200-day MA of 1.30, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 55.23 is Neutral, neither overbought nor oversold. The STOCH value of 54.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CAN.
Canaan Risk Analysis
Canaan disclosed 91 risk factors in its most recent earnings report. Canaan reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Canaan Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $34.04B | 6.14 | -11.52% | 1.82% | 5.53% | -18.79% | |
54 Neutral | $349.83M | ― | -9.62% | ― | 7.35% | 16.59% | |
44 Neutral | $199.24M | ― | -90.43% | ― | 65.68% | 50.28% | |
43 Neutral | $234.63M | ― | -99.85% | ― | -8.09% | 22.06% | |
41 Neutral | $59.13M | ― | 33.98% | ― | -17.08% | -223.70% | |
41 Neutral | $22.12M | ― | -7.51% | ― | 20.88% | ― |
* Technology Sector Average
Performance Comparison
CAN
Canaan
0.70
-0.34
-32.69%
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1.61
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EBON
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3.38
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.