China Distance Education (NYSE:DL) and Scientific Learning (OTCMKTS:SCIL) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, profitability, valuation and earnings.
Insider and Institutional Ownership
18.9% of China Distance Education shares are held by institutional investors. 41.6% of China Distance Education shares are held by insiders. Comparatively, 16.1% of Scientific Learning shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This is a breakdown of recent ratings and price targets for China Distance Education and Scientific Learning, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|China Distance Education||0||0||0||0||N/A|
Volatility and Risk
China Distance Education has a beta of 0.97, indicating that its stock price is 3% less volatile than the S&P 500. Comparatively, Scientific Learning has a beta of 0.25, indicating that its stock price is 75% less volatile than the S&P 500.
Earnings and Valuation
This table compares China Distance Education and Scientific Learning’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|China Distance Education||$211.82 million||0.95||$21.25 million||$0.63||9.57|
|Scientific Learning||$16.74 million||0.15||-$870,000.00||N/A||N/A|
China Distance Education has higher revenue and earnings than Scientific Learning.
This table compares China Distance Education and Scientific Learning’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|China Distance Education||7.99%||13.82%||4.62%|
China Distance Education beats Scientific Learning on 9 of the 9 factors compared between the two stocks.
About China Distance Education
China Distance Education Holdings Ltd. engages in the provision of online education in China, which focuses on professional education. The company offers online courses through its websites, which are designed to help course participants obtain and maintain the skills, licenses and certifications necessary to pursue careers and professions in China. Its online professional education courses cover a wide range of industries, including accounting, law, healthcare, construction engineering and others. The company also offer online test preparation courses to self-taught learners pursuing higher education diplomas or degrees and to secondary school and college students for various academic and entrance exams. It offers online foreign language courses. China Distance Education Holdings was founded by Zhengdong Zhu, Baohong Yin and Hongfeng Sun in July 2000 and is headquartered in Beijing, China.
About Scientific Learning
Scientific Learning Corporation, an education company, develops, distributes, and licenses technology that accelerates learning by enhancing the processing efficiency of the brain. Its flagship Fast ForWord, a Web-based product, comprises Fast ForWord Language for elementary learners and Fast ForWord Literacy for adolescent learners that build foundational reading and language skills to help districts move below grade level learners to learn in the general classroom, and Fast ForWord Reading, which builds learning capacity through developing cognitive skills using exercises focusing on phonemic awareness, phonics and decoding, spelling, vocabulary, fluency, and comprehension. The company also provides Reading Assistant that offers a one-on-one reading tutor for learners; ResultsNow!, an online hosting and support solution for its Fast ForWord and Reading Assistant products; and BrainPro services targeted at learners who are below grade level. In addition, it offers on-site product training, technical installation, implementation management, consulting, and Web-based synchronous and asynchronous professional development services; and software technical update releases, as well as extensive telephone, email, and chat support services. The company offers learning solutions primarily to educational institutions, speech and language clinics, learning centers, and parents. Scientific Learning Corporation was founded in 1995 and is headquartered in Oakland, California.
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