New Oriental Education & Technology Group (NYSE: EDU) and Laureate Education (NASDAQ:LAUR) are both consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, earnings, analyst recommendations, valuation, dividends and institutional ownership.

Insider and Institutional Ownership

83.1% of New Oriental Education & Technology Group shares are owned by institutional investors. Comparatively, 99.6% of Laureate Education shares are owned by institutional investors. 15.5% of New Oriental Education & Technology Group shares are owned by company insiders. Comparatively, 13.1% of Laureate Education shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for New Oriental Education & Technology Group and Laureate Education, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
New Oriental Education & Technology Group 0 2 6 0 2.75
Laureate Education 0 3 10 0 2.77

New Oriental Education & Technology Group currently has a consensus target price of $69.76, suggesting a potential downside of 10.83%. Laureate Education has a consensus target price of $17.44, suggesting a potential upside of 14.37%. Given Laureate Education’s stronger consensus rating and higher possible upside, analysts clearly believe Laureate Education is more favorable than New Oriental Education & Technology Group.

Profitability

This table compares New Oriental Education & Technology Group and Laureate Education’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
New Oriental Education & Technology Group 15.25% 17.02% 10.29%
Laureate Education N/A N/A N/A

Earnings & Valuation

This table compares New Oriental Education & Technology Group and Laureate Education’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
New Oriental Education & Technology Group $1.80 billion 6.85 $310.66 million $1.74 44.96
Laureate Education $4.24 billion 0.61 $648.36 million N/A N/A

Laureate Education has higher revenue and earnings than New Oriental Education & Technology Group.

Summary

Laureate Education beats New Oriental Education & Technology Group on 6 of the 11 factors compared between the two stocks.

About New Oriental Education & Technology Group

New Oriental Education & Technology Group Inc. is a provider of private educational services in the People’s Republic of China (the PRC). The Company provides educational services under its New Oriental brand. The Company operates through seven segments, which include language training and test preparation, primary and secondary school education, online education, content development and distribution, pre-school education, overseas study consulting services and study tour. The Company offers a range of educational programs, services and products, consisting of English and other foreign language training, test preparation courses for admissions and assessment tests in the United States, the People’s Republic of China and Commonwealth countries, primary and secondary school education, development and distribution of educational content, software and other technology, and online education.

About Laureate Education

Laureate Education, Inc. operates a network of degree-granting higher education institution. The Company operates in four segments: Latin America (LatAm); Europe; Asia, Middle East and Africa (AMEA), and Global Products and Services (GPS). The Company’s network includes approximately 70 institutions in over 25 countries on over 200 campuses, which the Company collectively refer to as the Laureate International Universities network. The Laureate International Universities network enables the Company to educate its students locally, while connecting them to an international community with a global perspective. The Company’s educational institutions offer a diverse range of academic programs, at the undergraduate and graduate level, including Business and Management; Medical and Health Sciences; Engineering and Information Technology; Architecture, Art and Design; Education; Law and Legal Studies; Communications, and Hospitality Management.

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