Critical Survey: Four Seasons Edu (Cayman) (FEDU) versus Ambow Education (AMBOY)

Four Seasons Edu (Cayman) (NYSE:FEDU) and Ambow Education (OTCMKTS:AMBOY) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.

Profitability

This table compares Four Seasons Edu (Cayman) and Ambow Education’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Four Seasons Edu (Cayman) 8.78% 4.09% 3.18%
Ambow Education N/A N/A N/A

Dividends

Four Seasons Edu (Cayman) pays an annual dividend of $0.40 per share and has a dividend yield of 9.1%. Ambow Education does not pay a dividend. Four Seasons Edu (Cayman) pays out 210.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Four Seasons Edu (Cayman) and Ambow Education’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Four Seasons Edu (Cayman) $47.49 million 1.11 $7.01 million $0.19 23.21
Ambow Education N/A N/A N/A N/A N/A

Four Seasons Edu (Cayman) has higher revenue and earnings than Ambow Education.

Insider & Institutional Ownership

60.7% of Four Seasons Edu (Cayman) shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and target prices for Four Seasons Edu (Cayman) and Ambow Education, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Four Seasons Edu (Cayman) 1 1 0 0 1.50
Ambow Education 0 0 0 0 N/A

Four Seasons Edu (Cayman) presently has a consensus price target of $4.00, suggesting a potential downside of 9.30%. Given Four Seasons Edu (Cayman)’s higher possible upside, analysts clearly believe Four Seasons Edu (Cayman) is more favorable than Ambow Education.

Summary

Four Seasons Edu (Cayman) beats Ambow Education on 7 of the 8 factors compared between the two stocks.

Four Seasons Edu (Cayman) Company Profile

Four Seasons Education (Cayman) Inc., together with its subsidiaries, provides after-school education services in the People's Republic of China. The company's education services comprise standard programs; personalized Ivy programs; and special programs, including competition workshops and courses delivered to K-12 schools. It also offers education and management consulting services. The company offers after-school education services for kindergarten, elementary, and middle school students. As of February 28, 2018, the company operated 31 learning centers in Shanghai and 7 in other cities. Four Seasons Education (Cayman) Inc. was founded in 2007 and is based in Shanghai, the People's Republic of China.

Ambow Education Company Profile

Ambow Education Holding Ltd. provides educational and career enhancement services to students, recent graduates, and corporate employees and management in China. The company operates through two business divisions, Better Schools and Better Jobs. The Better Schools division provides educational services covering K-12 programs and tutoring services that provide test preparation programs; and international education programs. This division operates tutoring centers that provide classroom instruction, small class, and one-on-one tutoring services for students to perform better in school and prepare for important tests, primarily high school and university entrance exams; and educational curriculum through its Web-based applications to allow students access to tutoring services. Its educational software products include eBoPo, which offers full subjects, online practice tests, and instruction for K-12 level students. The Better Jobs division offers career enhancement services that facilitate post-secondary students obtaining employment. This division provides students with hands-on training for professional skills, including case studies, job environment simulation, and specific technical skills; and soft skills training, including courses on time management, presentation, leadership, and interview techniques. As of December 31, 2016, it had a total of 45 centers and schools, including 12 tutoring centers, 4 K-12 schools, 10 career enhancement centers, 18 training offices, and 1 career enhancement campus. Ambow Education Holding Ltd. was founded in 2000 and is headquartered in Beijing, the People's Republic of China.

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