Analyzing Wah Fu Education Group (NASDAQ:WAFU) and Udemy (NASDAQ:UDMY)

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

Analyst Recommendations

This is a summary of recent ratings for Wah Fu Education Group and Udemy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wah Fu Education Group	0	0	0	0	0.00
Udemy	1	4	7	0	2.50

Udemy has a consensus target price of $10.68, suggesting a potential upside of 76.85%. Given Udemy’s stronger consensus rating and higher probable upside, analysts clearly believe Udemy is more favorable than Wah Fu Education Group.

Volatility and Risk

Wah Fu Education Group has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, Udemy has a beta of 1.81, meaning that its stock price is 81% more volatile than the S&P 500.

Earnings and Valuation

This table compares Wah Fu Education Group and Udemy”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wah Fu Education Group	$6.37 million	1.01	-$60,000.00	N/A	N/A
Udemy	$786.57 million	1.13	-$85.29 million	($0.57)	-10.60

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

Profitability

This table compares Wah Fu Education Group and Udemy’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
Udemy	-10.84%	-27.93%	-10.14%

Institutional and Insider Ownership

79.5% of Udemy shares are owned by institutional investors. 72.0% of Wah Fu Education Group shares are owned by insiders. Comparatively, 3.2% of Udemy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Udemy beats Wah Fu Education Group on 7 of the 12 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 Udemy

Udemy, Inc., a learning company, that operates a marketplace platform for learning skills in the United States and internationally. The company offers skill acquisition, development, and validation courses for organizations and individuals, through direct-to-consumer or Udemy Business offerings in various languages. Its courses provide learning objectives, such as reskilling or upskilling in technology, business, soft skills, and personal development, as well as learners receive access to interactive learning tools comprising quizzes, exercises, and instructor questions-and-answers. The company was incorporated in 2010 and is headquartered in San Francisco, California.