Youdao (NYSE:DAO – Get Free Report) and Cengage Learning Holdings II (OTCMKTS:CNGO – Get Free Report) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, institutional ownership, dividends, valuation and risk.
Profitability
This table compares Youdao and Cengage Learning Holdings II’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Youdao | 1.19% | -4.51% | 4.89% |
| Cengage Learning Holdings II | N/A | N/A | N/A |
Valuation & Earnings
This table compares Youdao and Cengage Learning Holdings II”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Youdao | $822.04 million | 2.35 | $15.35 million | $0.09 | 178.11 |
| Cengage Learning Holdings II | N/A | N/A | N/A | N/A | N/A |
Youdao has higher revenue and earnings than Cengage Learning Holdings II.
Analyst Ratings
This is a summary of current ratings and recommmendations for Youdao and Cengage Learning Holdings II, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Youdao | 1 | 0 | 1 | 0 | 2.00 |
| Cengage Learning Holdings II | 0 | 0 | 0 | 0 | 0.00 |
Institutional and Insider Ownership
21.9% of Youdao shares are held by institutional investors. 43.0% of Youdao shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Summary
Youdao beats Cengage Learning Holdings II on 7 of the 8 factors compared between the two stocks.
About Youdao
Youdao, Inc., an internet technology company, provides online services in the field of content, community, communication, and commerce in China. It operates through three segments: Learning Services, Smart Devices, and Online Marketing Services. The company provides various learning content, applications, and solutions, which cover topics and target people from various age groups for their learning needs through its websites and mobile applications. It offers online knowledge tools, which include Youdao and other dictionaries and translation tools; learning services consisting of tutoring, fee-based premium, and other services; STEAM courses, adult and vocational courses, and other courses, such as China University MOOC; smart devices, such as Youdao Dictionary Pen, Youdao Listening Pod, Youdao Smart light, Youdao Pocket Translator, and Youdao Super Dictionary; education digitalization solutions comprising technologies and solutions licensed to schools or enterprise customers, such as Youdao Smart Learning Terminal, Youdao Sports, and Youdao Smart Cloud; and online marketing services. In addition, the company provides online courses comprising Youdao Premium Courses and NetEase Cloud Classroom, as well as technical support to the variable interest entities (VIEs). Youdao, Inc. was founded in 2006 and is headquartered in Hangzhou, China. Youdao, Inc. is a subsidiary of NetEase, Inc.
About Cengage Learning Holdings II
Cengage Learning Holdings II, Inc., together with its subsidiaries, operates as an education technology company worldwide. The company operates through three segments: Cengage Academic, Cengage Work, and Cengage Select. It offers eTextbooks; Cengage Unlimited, a subscription service for digital higher education materials; eTextbook subscription service; Cengage Infuse, an embedded course kit with a user experience for instructors; print textbooks, study guides, laboratory exercises, instructor editions, and supplemental products; and course and custom content development, and direct assistance to instructors and students for implementation and ongoing use of digital and print solutions. The company also provides various platforms, such as MindTap for as business and economics, social sciences, trades, and skills; WebAssign for mathematics and physics; Skills Assessment Manager for introductory computing; Cengage NOW for accounting; and Online Web-Based Learning for such as chemistry. In addition, it offers ed2go, an online learning platform; K-12, public, and academic libraries under the Gale brand, as well as licenses its proprietary and third-party content for integration with web-based information providers; English language curriculum and digital solutions under the NGL brand; educational resources for career-focused beauty and wellness education providers; and literacy materials to K-6 students under the Nelson brand. Further, the company Infosec, a cybersecurity education platform comprising Bootcamps, which provides instructor-led, digital course experiences for cybersecurity certifications or skill sets; Infosec Skills that offers training for reskilling and upskilling in the cybersecurity profession; and Infosec IQ, which offers security awareness training for non-technical learners to recognize, avoid, and report cyber-attacks and security incidents. The company was founded in 1903 and is headquartered in Boston, Massachusetts.
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