Gaotu Techedu (NYSE:GOTU) & Udemy (NASDAQ:UDMY) Head-To-Head Review

Gaotu Techedu (NYSE:GOTU) and Udemy (NASDAQ:UDMY) are both business services companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Insider & Institutional Ownership

29.9% of Gaotu Techedu shares are owned 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.

Profitability

This table compares Gaotu Techedu and Udemy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gaotu Techedu -46.71% -108.01% -49.26%
Udemy N/A N/A N/A

Valuation & Earnings

This table compares Gaotu Techedu and Udemy’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Gaotu Techedu $1.09 billion 0.42 -$213.47 million ($2.36) -0.77
Udemy N/A N/A N/A N/A N/A

Udemy has lower revenue, but higher earnings than Gaotu Techedu.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Gaotu Techedu and Udemy, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gaotu Techedu 4 2 0 0 1.33
Udemy 0 3 9 0 2.75

Gaotu Techedu currently has a consensus price target of $8.16, suggesting a potential upside of 350.83%. Udemy has a consensus price target of $35.09, suggesting a potential upside of 128.75%. Given Gaotu Techedu’s higher probable upside, analysts clearly believe Gaotu Techedu is more favorable than Udemy.

Summary

Udemy beats Gaotu Techedu on 5 of the 8 factors compared between the two stocks.

Gaotu Techedu Company Profile

Gaotu Techedu, Inc. is a technology-driven education company. Its core expertise is in online K-12 courses, and online K-12 large-class after-school tutoring service provider in China. The company’s K-12 courses cover all primary and secondary grades. It also offers foreign language, professional and interest courses. The company was founded by Xiang Dong Chen in June 2014 and is headquartered in Beijing, China.

Udemy Company Profile

Udemy Inc. develops educational software solutions. The Company offers an online course in various subjects including technology, Internet, business, creative and performing arts, health and fitness, language and music. Udemy Inc. is based in San Francisco, United States.

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