Contrasting QuantaSing Group (NASDAQ:QSG) & Udemy (NASDAQ:UDMY)

QuantaSing Group (NASDAQ:QSG) and Udemy (NASDAQ:UDMY) are both small-cap consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Valuation & Earnings

This table compares QuantaSing Group and Udemy’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
QuantaSing Group	$3.62 billion	0.03	-$14.97 million	$0.57	2.89
Udemy	$749.35 million	1.63	-$107.29 million	($0.53)	-15.08

QuantaSing Group has higher revenue and earnings than Udemy. Udemy is trading at a lower price-to-earnings ratio than QuantaSing Group, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

QuantaSing Group has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500. Comparatively, Udemy has a beta of 2.02, suggesting that its stock price is 102% more volatile than the S&P 500.

Institutional & Insider Ownership

79.5% of Udemy shares are held by institutional investors. 3.2% of Udemy shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares QuantaSing Group and Udemy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QuantaSing Group	6.69%	79.30%	18.29%
Udemy	-10.82%	-23.10%	-10.59%

Analyst Ratings

This is a summary of recent ratings and target prices for QuantaSing Group and Udemy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QuantaSing Group	0	1	1	0	2.50
Udemy	0	4	6	0	2.60

QuantaSing Group currently has a consensus target price of $9.85, indicating a potential upside of 496.97%. Udemy has a consensus target price of $13.90, indicating a potential upside of 73.97%. Given QuantaSing Group’s higher possible upside, research analysts clearly believe QuantaSing Group is more favorable than Udemy.

Summary

QuantaSing Group beats Udemy on 8 of the 14 factors compared between the two stocks.

About QuantaSing Group

QuantaSing Group Limited provides online learning services in the People's Republic of China. The company offers online courses, including financial literacy, short-video production, personal well-being, electronic keyboard, and meditation courses. It also offers marketing and enterprise talent management services to enterprise customers. In addition, the company provides online and literacy course to adult learners under various brands, including QiNiu, JiangZhen, and QianChi. QuantaSing Group Limited was founded in 2019 and is headquartered in Beijing, the People's Republic of China.

About Udemy

Udemy, Inc., a learning company, that operates a marketplace platform for learning skills in the United States and internationally. The company offers skill acquisition, development, and validation courses for organizations and individuals, through direct-to-consumer or Udemy Business offerings in various languages. Its courses provide learning objectives, such as reskilling or upskilling in technology, business, soft skills, and personal development, as well as learners receive access to interactive learning tools comprising quizzes, exercises, and instructor questions-and-answers. The company was incorporated in 2010 and is headquartered in San Francisco, California.