China Distance Education (NASDAQ: REDU) and RISE Education Cayman (NASDAQ:REDU) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, institutional ownership, dividends, earnings, analyst recommendations and profitability.
This is a breakdown of recent recommendations and price targets for China Distance Education and RISE Education Cayman, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|China Distance Education||0||0||0||0||N/A|
|RISE Education Cayman||0||0||3||0||3.00|
RISE Education Cayman has a consensus price target of $15.50, suggesting a potential upside of 56.41%. Given RISE Education Cayman’s higher probable upside, analysts plainly believe RISE Education Cayman is more favorable than China Distance Education.
Valuation and Earnings
This table compares China Distance Education and RISE Education Cayman’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|China Distance Education||$130.99 million||2.31||$14.93 million||N/A||N/A|
|RISE Education Cayman||$148.98 million||3.66||-$7.37 million||$0.10||99.10|
China Distance Education has higher earnings, but lower revenue than RISE Education Cayman.
This table compares China Distance Education and RISE Education Cayman’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|China Distance Education||5.06%||12.48%||3.31%|
|RISE Education Cayman||-2.68%||20.71%||2.38%|
Insider and Institutional Ownership
22.1% of China Distance Education shares are held by institutional investors. Comparatively, 17.6% of RISE Education Cayman shares are held by institutional investors. 41.6% of China Distance Education shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
RISE Education Cayman beats China Distance Education on 6 of the 11 factors compared between the two stocks.
China Distance Education Company Profile
China Distance Education Holdings Limited provides online and offline education services, and sells related products in the People's Republic of China. It operates through three segments: Online Education Services, Business Start-Up Training Services, and The Sale of Learning Simulation Software. The company offers online professional education services in accounting, healthcare, and engineering and construction industries; and other professional education courses, such as online test-preparation courses for the national judicial examination and self-taught learners pursuing higher education diplomas or degrees, test preparation courses for university students, accounting practical skills training courses, and online language courses. Its online courses feature pre-recorded audio-video lectures taught by experts; and other content, such as course outlines, exercise questions, mock exams, and frequently asked questions and answers. The company's online lectures are supplemented by its proprietary Learning Management System, which tracks individual study progress, records course notes, and collects incorrectly answered questions. As of September 30, 2017, it operated 25 Websites, including its primary Website cdeledu.com. In addition, the company operates an Open Learning Platform, a proprietary education platform to share educational content and deliver live courses online; and sells proprietary books and reference materials. Further, it provides business start-up training courses to university students, job seekers, and individuals; offline accounting and healthcare professional training, courseware production, and online platform development services; and mobile accounting, engineering and construction, healthcare, and legal courses through an app on Android and Apple iOS tablets and smart phones, as well as sells learning simulation software to the college market. The company was founded in 2000 and is based in Beijing, the People's Republic of China.
RISE Education Cayman Company Profile
RISE Education Cayman Ltd, through its subsidiaries, provides junior English language training services under the RISE brand name in the People's Republic of China. The company offers a range of educational programs, services, and products, including educational courses, sale of course materials, franchise services, and study tours. It also provides educational consulting services. As of December 31, 2017, the company had a network of 270 learning centers comprising 64 self-owned centers and 206 franchised learning centers across 85 cities in the People's Republic of China. RISE Education Cayman Ltd was founded in 2007 and is headquartered in Beijing, the People's Republic of China.
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