Head to Head Review: Career Education (CECO) and RISE Education Cayman (REDU)

Career Education (NASDAQ: CECO) and RISE Education Cayman (NASDAQ:REDU) are both small-cap consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, risk, analyst recommendations, earnings, dividends and institutional ownership.

Profitability

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This table compares Career Education and RISE Education Cayman’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Career Education -5.35% 6.73% 4.44%
RISE Education Cayman N/A N/A N/A

Institutional & Insider Ownership

77.4% of Career Education shares are held by institutional investors. Comparatively, 10.8% of RISE Education Cayman shares are held by institutional investors. 5.0% of Career Education shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Career Education and RISE Education Cayman’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Career Education $596.43 million 1.50 -$31.89 million $0.31 41.71
RISE Education Cayman $148.98 million 5.55 -$7.37 million $0.10 150.40

RISE Education Cayman has lower revenue, but higher earnings than Career Education. Career Education is trading at a lower price-to-earnings ratio than RISE Education Cayman, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations for Career Education and RISE Education Cayman, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Career Education 0 1 0 0 2.00
RISE Education Cayman 0 0 1 0 3.00

Career Education currently has a consensus price target of $13.00, suggesting a potential upside of 0.54%. RISE Education Cayman has a consensus price target of $15.50, suggesting a potential upside of 3.06%. Given RISE Education Cayman’s stronger consensus rating and higher probable upside, analysts clearly believe RISE Education Cayman is more favorable than Career Education.

Summary

RISE Education Cayman beats Career Education on 7 of the 13 factors compared between the two stocks.

Career Education Company Profile

Career Education Corporation operates colleges, institutions, and universities that provide education to student population in various career-oriented disciplines through online, campus based, and blended learning programs in the United States. The company operates through three segments: Colorado Technical University (CTU), American InterContinental University (AIU), and All Other Campuses. Its colleges and universities include AIU, CTU, Le Cordon Bleu institutions, Briarcliffe College, Harrington College of Design, and Sanford-Brown College. The company offers doctoral, master's, bachelor's, and associate degrees, as well as diploma and certificate programs. It also provides academic programs in the career-oriented disciplines of business studies, nursing, computer science, engineering, information systems and technologies, cybersecurity, and healthcare management, as well as information technologies, and education and criminal justice; and educational programs in culinary arts, as well as patisserie and baking. As of December 31, 2017, the company had a total student enrollment of approximately 34,800 students. Career Education Corporation was founded in 1994 and is headquartered in Schaumburg, Illinois.

RISE Education Cayman Company Profile

RISE Education Cayman Ltd, through its subsidiaries, provides junior English language training services under the RISE brand name in the People's Republic of China. The company offers a range of educational programs, services, and products, including educational courses, sale of course materials, franchise services, and study tours. It also provides educational consulting services. As of June 30, 2017, the company had a network of 246 learning centers comprising 56 self-owned centers and 190 franchised learning centers across 80 cities in China. RISE Education Cayman Ltd was founded in 2007 and is headquartered in Beijing, China.

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