Xueda Education Group (NYSE: XUE) and K12 (NYSE:LRN) are both non-cyclical consumer goods & services companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, risk, earnings and dividends.

Profitability

This table compares Xueda Education Group and K12’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Xueda Education Group -4.53% -15.97% -4.86%
K12 0.05% 3.18% 2.40%

Valuation and Earnings

This table compares Xueda Education Group and K12’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Xueda Education Group N/A N/A N/A N/A N/A
K12 $888.52 million 0.81 $35.91 million N/A N/A

K12 has higher revenue and earnings than Xueda Education Group.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Xueda Education Group and K12, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Xueda Education Group 0 0 0 0 N/A
K12 0 0 2 0 3.00

K12 has a consensus target price of $18.50, suggesting a potential upside of 4.40%. Given K12’s higher probable upside, analysts clearly believe K12 is more favorable than Xueda Education Group.

Institutional & Insider Ownership

79.5% of K12 shares are held by institutional investors. 18.3% of K12 shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

K12 beats Xueda Education Group on 8 of the 8 factors compared between the two stocks.

Xueda Education Group Company Profile

Xueda Education Group is a holding company. The Company, through its subsidiaries and consolidated variable interest entity (VIE), is engaged in providing private personalized tutoring services for primary and secondary school students in the People’s Republic of China (PRC). The Company has developed and implemented a results-oriented, student-centric service delivery model. The Company’s personalized service model consists of six components: assessment, consultation, formulation of a customized study plan, personalized tutoring, delivery of student-oriented supporting services and results. The Company’s learning centers are directly operated by it under its Xueda brand. The Company delivers its services to students through a national network, consisting of approximately 467 learning centers, all of which are operated by it, in 85 cities in China.

K12 Company Profile

K12 Inc. (K12) is a technology-based education company. The Company offers curriculum, software systems and educational services designed to facilitate individualized learning for students in kindergarten through 12th grade (K-12). It provides a continuum of technology-based educational products and solutions to public school districts, public schools, virtual charter schools, private schools and families. The Company offers a set of products and services primarily to three lines of business, which include Managed Public School Programs, which consists of virtual and blended schools; Institutional business, which includes educational products and services sold to school districts, public schools and other educational institutions, and Private Pay Schools and Other, which includes private schools, including international, for which it charges student tuition and direct consumer sales. It sells individual online courses and supplemental educational products directly to families.

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