Guardforce AI (NASDAQ:GFAI) versus Eastern (NASDAQ:EML) Critical Review

Eastern (NASDAQ:EML) and Guardforce AI (NASDAQ:GFAI) are both small-cap industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, valuation, dividends, risk, profitability and earnings.

Volatility and Risk

Eastern has a beta of 0.96, indicating that its share price is 4% less volatile than the S&P 500. Comparatively, Guardforce AI has a beta of 2.5, indicating that its share price is 150% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for Eastern and Guardforce AI, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eastern	1	0	0	0	1.00
Guardforce AI	1	0	1	0	2.00

Guardforce AI has a consensus price target of $4.50, indicating a potential upside of 312.84%. Given Guardforce AI’s stronger consensus rating and higher probable upside, analysts clearly believe Guardforce AI is more favorable than Eastern.

Valuation and Earnings

This table compares Eastern and Guardforce AI”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eastern	$272.75 million	0.47	-$8.53 million	($1.32)	-16.05
Guardforce AI	$36.35 million	0.53	-$5.86 million	N/A	N/A

Guardforce AI has lower revenue, but higher earnings than Eastern.

Profitability

This table compares Eastern and Guardforce AI’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eastern	-3.06%	10.44%	5.38%
Guardforce AI	N/A	N/A	N/A

Insider and Institutional Ownership

77.0% of Eastern shares are held by institutional investors. Comparatively, 2.0% of Guardforce AI shares are held by institutional investors. 17.0% of Eastern shares are held by company insiders. Comparatively, 76.7% of Guardforce AI shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Guardforce AI beats Eastern on 8 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 Guardforce AI

Guardforce AI Co., Limited offers cash solutions and cash handling services in Thailand. The company operates through four segments: Secured Logistics Business, General Security Solutions, Robotics Solution Business, and Information Security Business. Its services include cash-in-transit, vehicles to banks, ATM management, cash center operations, cash processing, coin processing, consolidate cash center, and cheque center services, as well as cash deposit machine solutions, such as cash deposit management and express cash services. The company also sells and rents robots; and sells and installs Rapid7 software, as well as provision of integrated alarm security system installation, PCI ASV scan, and penetration testing services. Its customers include local commercial banks, chain retailers, coin manufacturing mints, and government authorities. The company was founded in 1982 and is based in Singapore.