New Oriental Education & Technology Group (NYSE:EDU) and Chegg (NYSE:CHGG) are both large-cap consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, valuation, earnings and risk.
Risk and Volatility
New Oriental Education & Technology Group has a beta of 0.95, meaning that its stock price is 5% less volatile than the S&P 500. Comparatively, Chegg has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.
Insider and Institutional Ownership
80.7% of New Oriental Education & Technology Group shares are owned by institutional investors. Comparatively, 98.5% of Chegg shares are owned by institutional investors. 15.5% of New Oriental Education & Technology Group shares are owned by company insiders. Comparatively, 3.1% of Chegg shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares New Oriental Education & Technology Group and Chegg's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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New Oriental Education & Technology Group | 10.85% | 12.98% | 5.61% |
Chegg | -4.26% | 13.35% | 4.09% |
Analyst Recommendations
This is a breakdown of current recommendations for New Oriental Education & Technology Group and Chegg, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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New Oriental Education & Technology Group | 0 | 0 | 6 | 1 | 3.14 |
Chegg | 2 | 3 | 11 | 0 | 2.56 |
New Oriental Education & Technology Group presently has a consensus target price of $177.2857, indicating a potential downside of 4.90%. Chegg has a consensus target price of $105.3125, indicating a potential upside of 6.32%. Given Chegg's higher probable upside, analysts plainly believe Chegg is more favorable than New Oriental Education & Technology Group.
Valuation and Earnings
This table compares New Oriental Education & Technology Group and Chegg's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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New Oriental Education & Technology Group | $3.58 billion | 8.80 | $413.33 million | $2.59 | 71.98 |
Chegg | $410.93 million | 31.20 | $-9,600,000.00 | $0.41 | 241.59 |
New Oriental Education & Technology Group has higher revenue and earnings than Chegg. New Oriental Education & Technology Group is trading at a lower price-to-earnings ratio than Chegg, indicating that it is currently the more affordable of the two stocks.
Summary
New Oriental Education & Technology Group beats Chegg on 9 of the 15 factors compared between the two stocks.