Head-To-Head Analysis: TAL Education Group (NYSE:TAL) and 17 Education & Technology Group (NYSE:YQ)

17 Education & Technology Group (NYSE:YQ) and TAL Education Group (NYSE:TAL) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, earnings, risk, dividends, profitability and analyst recommendations.

Profitability

This table compares 17 Education & Technology Group and TAL Education Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
17 Education & Technology Group	-113.55%	-38.90%	-28.18%
TAL Education Group	22.13%	18.96%	11.64%

Analyst Recommendations

This is a summary of current ratings for 17 Education & Technology Group and TAL Education Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
17 Education & Technology Group	0	1	1	0	2.50
TAL Education Group	0	2	1	1	2.75

TAL Education Group has a consensus target price of $15.05, suggesting a potential upside of 51.03%. Given TAL Education Group’s stronger consensus rating and higher possible upside, analysts clearly believe TAL Education Group is more favorable than 17 Education & Technology Group.

Institutional and Insider Ownership

3.5% of 17 Education & Technology Group shares are held by institutional investors. Comparatively, 37.8% of TAL Education Group shares are held by institutional investors. 23.1% of 17 Education & Technology Group shares are held by insiders. Comparatively, 1.8% of TAL Education Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares 17 Education & Technology Group and TAL Education Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
17 Education & Technology Group	$248.49 million	0.12	-$43.92 million	($1.28)	-2.12
TAL Education Group	$3.01 billion	1.83	$530.75 million	$1.31	7.61

TAL Education Group has higher revenue and earnings than 17 Education & Technology Group. 17 Education & Technology Group is trading at a lower price-to-earnings ratio than TAL Education Group, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

17 Education & Technology Group has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, TAL Education Group has a beta of 0.22, meaning that its share price is 78% less volatile than the S&P 500.

Summary

TAL Education Group beats 17 Education & Technology Group on 12 of the 14 factors compared between the two stocks.

About 17 Education & Technology Group

17 Education & Technology Group Inc. is a China-based education technology company that provides digital tools and services for K-12 education. The company operates an online platform that connects students, teachers, parents and schools, with a focus on improving teaching, learning and communication through technology. Its products and services include digital homework and learning tools, educational content, classroom and school-management solutions, and data-driven applications designed to support teachers and school administrators.

About TAL Education Group

TAL Education Group is a China-based education and technology company that provides learning services, educational content and related technology products. Its offerings include learning programs and digital resources for students, as well as smart learning devices and solutions for families and schools. Founded in 2003 as Xueersi, the company later adopted the name TAL Education Group. Following changes to China’s regulation of compulsory-education tutoring, TAL shifted its business toward services and products such as non-academic learning programs, educational technology and learning materials.