Aspen Group (NASDAQ: ASPU) and China Distance Education Holdings Limited (NYSE:DL) are both small-cap computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, analyst recommendations, risk, dividends and valuation.

Institutional & Insider Ownership

2.5% of Aspen Group shares are owned by institutional investors. Comparatively, 20.4% of China Distance Education Holdings Limited shares are owned by institutional investors. 15.3% of Aspen Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Aspen Group and China Distance Education Holdings Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aspen Group -8.69% -29.44% -14.10%
China Distance Education Holdings Limited 16.70% 38.05% 11.93%

Analyst Ratings

This is a summary of current ratings and target prices for Aspen Group and China Distance Education Holdings Limited, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aspen Group 0 0 2 0 3.00
China Distance Education Holdings Limited 1 0 0 0 1.00

Aspen Group presently has a consensus target price of $10.00, suggesting a potential upside of 13.64%. Given Aspen Group’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Aspen Group is more favorable than China Distance Education Holdings Limited.

Earnings & Valuation

This table compares Aspen Group and China Distance Education Holdings Limited’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Aspen Group $14.25 million 8.39 -$1.10 million ($0.13) -67.69
China Distance Education Holdings Limited $117.55 million 2.19 $26.29 million $0.65 12.00

China Distance Education Holdings Limited has higher revenue and earnings than Aspen Group. Aspen Group is trading at a lower price-to-earnings ratio than China Distance Education Holdings Limited, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Aspen Group has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500. Comparatively, China Distance Education Holdings Limited has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500.

Dividends

China Distance Education Holdings Limited pays an annual dividend of $0.45 per share and has a dividend yield of 5.8%. Aspen Group does not pay a dividend. China Distance Education Holdings Limited pays out 69.2% of its earnings in the form of a dividend. China Distance Education Holdings Limited has raised its dividend for 2 consecutive years.

Summary

China Distance Education Holdings Limited beats Aspen Group on 10 of the 16 factors compared between the two stocks.

About Aspen Group

Aspen Group, Inc. is a holding company. The Company’s subsidiary, Aspen University Inc. (Aspen), is dedicated to provide the education experiences taught by professors. Aspen offers approximately two monthly payment programs, a monthly payment plan in which students make payments every month over a fixed period (36, 39 or 72 months depending on the degree program) and a monthly installment plan in which students pay over three monthly installments (day 1, day 31 and day 61 after the start of each course). As of June 30, 2016, Aspen had 2,074 students paying tuition through either of the monthly payment methods. It offers certificate programs and associate, bachelor’s, master’s and doctoral degree programs in a range of areas, including nursing, business, education and professional studies. It offers a range of nursing degrees, including Master of Science in Nursing, Master of Science in Nursing-Nursing Education and Master of Science in Nursing-Nursing Administration and Management.

About China Distance Education Holdings Limited

China Distance Education Holdings Limited is a holding company. The Company is engaged in providing online and offline education services, and selling related products in the People’s Republic of China (PRC). The Company’s segments include online education services, business start-up training services and the sale of learning simulation software. The Company primarily sells books and reference materials related to its courses, such as the various levels of Accounting Professional Qualification Examinations, accounting continuing education, the National Practicing Medical Doctor Qualification Examination, the National Pharmacist Qualification Examination, and Associate Constructor and Constructor Qualification Examinations. It offers college oriented online-to-offline products and services, business start-up training courses and others. The Company had a content library with 263 course offerings of audio-video content, as of September 30, 2016.

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