Gaotu Techedu (NYSE:GOTU) Shares Climb 3.7% - Still a Buy?

Key Points

• Gaotu Techedu shares rose 3.7% to about $2.68 in mid-day trading, with volume significantly below the stock’s average session volume.
• Despite the price increase, analyst sentiment remains negative: Weiss Ratings upgraded the stock within its “Sell” category, while MarketBeat reports an average rating of “Sell.”
• The company recently missed quarterly EPS expectations, reporting a loss of $0.09 per share versus the expected $0.01 loss, although revenue of $245.82 million exceeded estimates.

Gaotu Techedu Inc. (NYSE:GOTU - Get Free Report)'s share price shot up 3.7% during mid-day trading on Wednesday. The stock traded as high as $2.66 and last traded at $2.6750. 165,426 shares were traded during trading, a decline of 62% from the average session volume of 438,334 shares. The stock had previously closed at $2.58.

Analysts Set New Price Targets

Separately, Weiss Ratings raised shares of Gaotu Techedu from a "sell (e+)" rating to a "sell (d-)" rating in a research note on Friday. One analyst has rated the stock with a Sell rating, According to data from MarketBeat.com, Gaotu Techedu has an average rating of "Sell".

Gaotu Techedu Stock Up 8.7%

The firm's 50 day moving average price is $2.04 and its two-hundred day moving average price is $1.89. The company has a market cap of $672.78 million, a P/E ratio of -13.36 and a beta of 0.73. The company has a debt-to-equity ratio of 0.15, a quick ratio of 0.85 and a current ratio of 0.86.

Gaotu Techedu (NYSE:GOTU - Get Free Report) last announced its quarterly earnings data on Thursday, August 27th. The company reported ($0.09) EPS for the quarter, missing analysts' consensus estimates of ($0.01) by ($0.08). Gaotu Techedu had a negative net margin of 5.00% and a negative return on equity of 26.89%. The firm had revenue of $245.82 million during the quarter, compared to analyst estimates of $238.39 million.

Hedge Funds Weigh In On Gaotu Techedu

A number of hedge funds have recently added to or reduced their stakes in GOTU. Renaissance Technologies LLC increased its holdings in Gaotu Techedu by 2.2% during the 1st quarter. Renaissance Technologies LLC now owns 2,330,640 shares of the company's stock worth $4,568,000 after purchasing an additional 50,362 shares in the last quarter. Hsbc Holdings PLC boosted its position in shares of Gaotu Techedu by 27.7% during the first quarter. Hsbc Holdings PLC now owns 161,501 shares of the company's stock valued at $319,000 after buying an additional 35,044 shares during the last quarter. Public Employees Retirement System of Ohio purchased a new position in shares of Gaotu Techedu during the second quarter valued at approximately $53,000. Headlands Technologies LLC bought a new stake in Gaotu Techedu during the second quarter worth $35,000. Finally, SmartHarvest Portfolios LLC purchased a new stake in Gaotu Techedu in the 1st quarter valued at $29,000. Institutional investors and hedge funds own 48.42% of the company's stock.

Gaotu Techedu Company Profile

Gaotu Techedu Inc NYSE: GOTU is a China-based education technology company that provides online and technology-enabled learning services. Its offerings have included courses and educational content for children and students, as well as programs focused on adult education, professional development and foreign-language learning.

The company also develops digital learning products and services designed to support students, teachers and families, including online instruction, educational applications and related learning tools.

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