China Online Education Group (NYSE:COE) and GSX Techedu (NYSE:GSX) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.
Insider and Institutional Ownership
7.2% of China Online Education Group shares are held by institutional investors. Comparatively, 6.6% of GSX Techedu shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
This table compares China Online Education Group and GSX Techedu’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|China Online Education Group||-25.48%||N/A||-31.25%|
Valuation & Earnings
This table compares China Online Education Group and GSX Techedu’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|China Online Education Group||$166.61 million||0.85||-$60.61 million||N/A||N/A|
|GSX Techedu||$59.20 million||56.62||$2.93 million||N/A||N/A|
GSX Techedu has lower revenue, but higher earnings than China Online Education Group.
This is a summary of current ratings and price targets for China Online Education Group and GSX Techedu, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|China Online Education Group||0||0||0||0||N/A|
GSX Techedu has a consensus target price of $19.50, suggesting a potential upside of 36.84%. Given GSX Techedu’s higher possible upside, analysts plainly believe GSX Techedu is more favorable than China Online Education Group.
GSX Techedu beats China Online Education Group on 6 of the 8 factors compared between the two stocks.
China Online Education Group Company Profile
China Online Education Group, through its subsidiaries, provides online English language education services to students in the People's Republic of China and the Philippines. It operates online and mobile education platforms that enable students to take live interactive English lessons with international foreign teachers. The company's flagship courses include Classic English and Classic English Junior for the development of English communication skills. It also offers American Academy and Small Class courses; 51 Talk New Concept English course; and various specialty courses, such as Business English, IELTS Speaking, Free-talk, Interview English, Travel English, and Daily English for situation-based English education and test preparation needs. China Online Education Group was founded in 2011 and is headquartered in Beijing, the People's Republic of China.
GSX Techedu Company Profile
GSX Techedu Inc. operates as an online education company in the People's Republic of China. The company provides online K-12 large-class after-school tutoring services. It offers English courses for children in kindergarten; and courses that help children in grade one through grade seven. The company also provides foreign language courses, including English, Japanese, and Korean, as well as English test preparation courses for students taking post-graduate entrance exams in China; and professional courses primarily for working adults preparing for professional qualification exams comprising teacher's qualification, the Chartered Financial Analyst designation, fund qualification, and securities qualification exams. In addition, it offers personal interest courses, such as yoga, fashion, guitar, and Chinese calligraphy. Further, the company provides other courses, including offline business consulting courses, which target principals and other officers of private education institutions who want to enhance management skills; and operate Weishi, an interactive learning platform on Weixin. As of March 31, 2019, it had 169 instructors and 522 tutors. The company was formerly known as BaiJiaHuLian Group Holdings Limited and changed its name to GSX Techedu Inc. in January 2019. GSX Techedu Inc. was founded in 2014 and is headquartered in Beijing, China. GSX Techedu Inc. is a subsidiary of Ebetter International Group Limited.
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