Critical Survey: Sunlands Technology Group (NYSE:STG) and Nintendo (OTCMKTS:NTDOY)

Nintendo (OTCMKTS:NTDOY) and Sunlands Technology Group (NYSE:STG) are both consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Volatility & Risk

Nintendo has a beta of 0.39, meaning that its share price is 61% less volatile than the S&P 500. Comparatively, Sunlands Technology Group has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for Nintendo and Sunlands Technology Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nintendo	1	4	3	1	2.44
Sunlands Technology Group	1	0	0	0	1.00

Profitability

This table compares Nintendo and Sunlands Technology Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nintendo	21.00%	16.11%	12.47%
Sunlands Technology Group	18.56%	39.98%	17.58%

Earnings & Valuation

This table compares Nintendo and Sunlands Technology Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nintendo	$15.37 billion	4.60	$2.80 billion	$0.66	20.80
Sunlands Technology Group	$288.84 million	0.15	$52.28 million	$3.86	0.82

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

Institutional & Insider Ownership

0.0% of Nintendo shares are held by institutional investors. Comparatively, 26.4% of Sunlands Technology Group shares are held by institutional investors. 59.7% of Sunlands Technology Group shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Nintendo beats Sunlands Technology Group on 8 of the 14 factors compared between the two stocks.

About Nintendo

Nintendo Co., Ltd., together with its subsidiaries, develops, manufactures, and sells home entertainment products in Japan, the Americas, Europe, and internationally. It also offers video game platforms, playing cards, Karuta, and other products; and handheld and home console hardware systems and related software. The company was formerly known as Nintendo Playing Card Co., Ltd. and changed its name to Nintendo Co., Ltd. in 1963. Nintendo Co., Ltd. was founded in 1889 and is headquartered in Kyoto, Japan.

About Sunlands Technology Group

Sunlands Technology Group, through its subsidiaries, provides online education services through online and mobile platforms in the People's Republic of China. It offers various degree- and diploma-oriented post-secondary courses, including preparation courses for the self-taught higher education examination (STE) for learners pursuing associate diplomas or bachelor's degrees, as well as for the entrance examinations of Master of Business Administration programs. The company's STE courses include Chinese language and literature, law, pre-school education, marketing, English, human resource management, business administration, business management, modern corporate governance, financial management, advertising, accounting, administrative management, computer information management, finance, chain operation management, and visual communication and design and production. It also provides professional certification preparation courses in various industries and professions, such as accounting, human resources, teaching, and finance. In addition, the company offers education services through online and mobile platforms to adult students, pursuing post-secondary, and professional educations. The company was formerly known as Sunlands Online Education Group and changed its name to Sunlands Technology Group in August 2018. Sunlands Technology Group was founded in 2003 and is headquartered in Beijing, the People's Republic of China.