Head-To-Head Survey: Lincoln Educational Services (LINC) versus Xueda Education Group (XUE)

Lincoln Educational Services (NASDAQ: LINC) and Xueda Education Group (NYSE:XUE) are both small-cap non-cyclical consumer goods & services companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, valuation, profitability, institutional ownership, analyst recommendations, dividends and risk.

Analyst Recommendations

This is a summary of current ratings for Lincoln Educational Services and Xueda Education Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lincoln Educational Services 0 0 0 0 N/A
Xueda Education Group 0 0 0 0 N/A

Earnings & Valuation

This table compares Lincoln Educational Services and Xueda Education Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Lincoln Educational Services $196.91 million 0.26 -$28.30 million ($0.67) -3.10
Xueda Education Group N/A N/A N/A ($0.15) -36.27

Xueda Education Group has lower revenue, but higher earnings than Lincoln Educational Services. Xueda Education Group is trading at a lower price-to-earnings ratio than Lincoln Educational Services, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

62.2% of Lincoln Educational Services shares are owned by institutional investors. 6.1% of Lincoln Educational Services shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Lincoln Educational Services and Xueda Education Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lincoln Educational Services -15.45% -35.57% -11.30%
Xueda Education Group -4.53% -15.97% -4.86%

Volatility and Risk

Lincoln Educational Services has a beta of 2.72, meaning that its stock price is 172% more volatile than the S&P 500. Comparatively, Xueda Education Group has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500.

Summary

Lincoln Educational Services beats Xueda Education Group on 5 of the 9 factors compared between the two stocks.

Lincoln Educational Services Company Profile

Lincoln Educational Services Corporation is a provider of post-secondary education. The Company operates in two segments: Transportation and Skilled Trades, and Transitional. The Transportation and Skilled Trades segment offers academic programs in the disciplines of transportation and skilled trades (automotive, diesel, heating, ventilation and air conditioning (HVAC), welding and manufacturing). The Transitional segment includes operations that are being phased out and consists of its campus that is being taught out. It offers programs in automotive technology, skilled trades, which include HVAC, welding and computerized numerical control and electronic systems technology; healthcare services, which include nursing, dental assistant and pharmacy technician; hospitality services, which include culinary, therapeutic massage, cosmetology and aesthetics, and business and information technology, which includes information technology and criminal justice programs.

Xueda Education Group Company Profile

Xueda Education Group is a holding company. The Company, through its subsidiaries and consolidated variable interest entity (VIE), is engaged in providing private personalized tutoring services for primary and secondary school students in the People’s Republic of China (PRC). The Company has developed and implemented a results-oriented, student-centric service delivery model. The Company’s personalized service model consists of six components: assessment, consultation, formulation of a customized study plan, personalized tutoring, delivery of student-oriented supporting services and results. The Company’s learning centers are directly operated by it under its Xueda brand. The Company delivers its services to students through a national network, consisting of approximately 467 learning centers, all of which are operated by it, in 85 cities in China.

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