2U (NASDAQ: TWOU) is one of 195 public companies in the “IT Services & Consulting” industry, but how does it compare to its rivals? We will compare 2U to similar companies based on the strength of its analyst recommendations, dividends, institutional ownership, profitability, valuation, earnings and risk.

Institutional & Insider Ownership

61.2% of shares of all “IT Services & Consulting” companies are owned by institutional investors. 8.4% of 2U shares are owned by insiders. Comparatively, 16.8% of shares of all “IT Services & Consulting” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

2U has a beta of -0.22, meaning that its stock price is 122% less volatile than the S&P 500. Comparatively, 2U’s rivals have a beta of 1.28, meaning that their average stock price is 28% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for 2U and its rivals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
2U 0 0 10 0 3.00
2U Competitors 677 4367 7099 154 2.55

2U presently has a consensus price target of $59.70, indicating a potential downside of 4.86%. As a group, “IT Services & Consulting” companies have a potential downside of 0.49%. Given 2U’s rivals higher probable upside, analysts plainly believe 2U has less favorable growth aspects than its rivals.

Earnings & Valuation

This table compares 2U and its rivals top-line revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
2U $239.13 million -$20.12 million -123.04
2U Competitors $2.12 billion $374.78 million 36.68

2U’s rivals have higher revenue and earnings than 2U. 2U is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares 2U and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
2U -10.10% -12.48% -9.65%
2U Competitors -19.95% -51.43% -3.76%

Summary

2U rivals beat 2U on 8 of the 12 factors compared.

About 2U

2U, Inc. is a provider of an integrated solution consisting of cloud-based software-as-a-service (SaaS) combined with technology-enabled services (together, the Platform) that allows colleges and universities to deliver online degree programs. The Company’s SaaS technology consists of a learning environment (Online Campus), which acts as the hub for all student and faculty academic and social interaction, and a suite of integrated applications, which the Company uses to launch, operate and support the Company’s clients’ programs. The Company also provides a suite of technology-enabled services optimized with data analysis and machine learning techniques that support the complete lifecycle of a higher education program, including attracting students, advising students through the admissions application process, providing technical, success coaching and other support, facilitating accessibility to individuals with disabilities, and facilitating in-program field placements.

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