Head to Head Contrast: Wah Fu Education Group (NASDAQ:WAFU) vs. Gaotu Techedu (NYSE:GOTU)

Wah Fu Education Group (NASDAQ:WAFU) and Gaotu Techedu (NYSE:GOTU) are both small-cap business services companies, but which is the better business? We will compare the two companies based on the strength of their dividends, profitability, valuation, institutional ownership, risk, earnings and analyst recommendations.

Earnings and Valuation

This table compares Wah Fu Education Group and Gaotu Techedu”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wah Fu Education Group	$7.22 million	1.14	-$60,000.00	N/A	N/A
Gaotu Techedu	$3.51 billion	0.22	-$1.03 million	($0.08)	-37.56

Wah Fu Education Group has higher earnings, but lower revenue than Gaotu Techedu.

Profitability

This table compares Wah Fu Education Group and Gaotu Techedu’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wah Fu Education Group	N/A	N/A	N/A
Gaotu Techedu	-17.63%	-20.26%	-11.51%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Wah Fu Education Group and Gaotu Techedu, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wah Fu Education Group	0	0	0	0	N/A
Gaotu Techedu	1	2	1	0	2.00

Gaotu Techedu has a consensus target price of $7.23, suggesting a potential upside of 140.60%. Given Gaotu Techedu’s higher probable upside, analysts plainly believe Gaotu Techedu is more favorable than Wah Fu Education Group.

Risk and Volatility

Wah Fu Education Group has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, Gaotu Techedu has a beta of -0.01, suggesting that its share price is 101% less volatile than the S&P 500.

Insider & Institutional Ownership

48.4% of Gaotu Techedu shares are held by institutional investors. 72.0% of Wah Fu Education Group shares are held by company insiders. Comparatively, 44.9% of Gaotu Techedu shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Wah Fu Education Group beats Gaotu Techedu on 7 of the 11 factors compared between the two stocks.

About Wah Fu Education Group

Wah Fu Education Group Limited, through its subsidiaries, provides online exam preparation services and related technology solutions in the People's Republic of China. The company operates through two segments: Online Education Services, and Technological Development and Operation Services. The Online Education Services segment offers online education platforms to institutions, such as universities and training institutions, and online course development service companies. This segment provides self-study examination, continuing education, and non-diploma training platforms that allow students to enroll in courses for college credit; vocational education 1+X and higher vocational enrollment expansion teaching and educational administration platform; Huafu e-school system and paperless examination platform; and online training and examination preparation services directly to students. The Technological Development and Operation Services segment develops and maintains online education platforms and online courses for its clients, including universities and government agencies, as well as private clients, such as publishers; and provides consulting, maintenance, and updating services related to online education programs. In addition, the company produces online training course materials. Wah Fu Education Group Limited was founded in 1999 and is headquartered in Beijing, the People's Republic of China.

About Gaotu Techedu

Gaotu Techedu Inc., a technology-driven education company, provides learning services, educational content, and digitalized learning products in the People's Republic of China. The company offers traditional online academic subject tutoring services that covers academic subjects, such as mathematics, English, Chinese, physics, chemistry, biology, history, geography, and political science for students; non-academic tutoring services; personal interest courses comprising chess learning, family relationships and education, humanities, and science courses; and professional courses primarily for college students and adults preparing for professional qualification exams, such as teacher's qualification, Chartered Financial Analyst designation, Certified Public Accountant designation, and other exams. It also offers admission courses for admission tests and interviews, including national-post graduate entrance examination, civil service examinations, and others; foreign language courses; overseas study related services; and courses to prepare and pass certain language exams for study abroad, such as IELTS and TOEFL. In addition, the company designs and develops course outlines, interactive courseware, practice exercises, and lesson notes; publishes reference books comprising Chinese dictionary, dictionary of idioms, and past exam questions for the college entrance examination; and develops, expands, and upgrades education-centric digital products and solutions, as well as learning apps. Further, it offers books and digitalized auxiliary learning tools, such as smart devices and translation pens; and online tutoring services. The company was formerly known as GSX Techedu Inc. and changed its name to Gaotu Techedu Inc. in June 2021. Gaotu Techedu Inc. was incorporated in 2014 and is headquartered in Beijing, China.