Financial Comparison: Strategic Education (NASDAQ:STRA) vs. Lixiang Education (NASDAQ:LXEH)

Strategic Education (NASDAQ:STRA) and Lixiang Education (NASDAQ:LXEH) 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 profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Profitability

This table compares Strategic Education and Lixiang Education’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Strategic Education	10.21%	8.78%	6.97%
Lixiang Education	N/A	N/A	N/A

Volatility and Risk

Strategic Education has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500. Comparatively, Lixiang Education has a beta of -0.25, suggesting that its share price is 125% less volatile than the S&P 500.

Institutional & Insider Ownership

93.3% of Strategic Education shares are held by institutional investors. Comparatively, 0.5% of Lixiang Education shares are held by institutional investors. 3.6% of Strategic Education shares are held by company insiders. Comparatively, 75.0% of Lixiang Education shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for Strategic Education and Lixiang Education, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Strategic Education	0	2	2	1	2.80
Lixiang Education	1	0	0	0	1.00

Strategic Education currently has a consensus target price of $87.00, suggesting a potential upside of 10.06%. Given Strategic Education’s stronger consensus rating and higher possible upside, equities analysts plainly believe Strategic Education is more favorable than Lixiang Education.

Valuation and Earnings

This table compares Strategic Education and Lixiang Education”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Strategic Education	$1.27 billion	1.41	$126.61 million	$5.66	13.97
Lixiang Education	$4.41 million	0.04	-$17.43 million	N/A	N/A

Strategic Education has higher revenue and earnings than Lixiang Education.

Summary

Strategic Education beats Lixiang Education on 12 of the 13 factors compared between the two stocks.

About Strategic Education

Strategic Education, Inc., through its subsidiaries, provides education services through campus-based and online post-secondary education, and programs to develop job-ready skills. The company operates through U.S. Higher Education, Australia/New Zealand, and Education Technology Services segments. It operates Strayer University that offers undergraduate and graduate degree programs in business, criminal justice, education, health services, information technology, and public administration at physical campuses located in the eastern United States, as well as through online; non-degree web and mobile application development courses through Hackbright Academy and Devmountain; and MBA online through its Jack Welch Management Institute. In addition, the company operates Capella University that provides post-secondary education; Torrens University, which offers undergraduate, graduate, higher degree by research, and specialized degree courses primarily in business, design and creative technology, health, hospitality, and education fields through online and on physical campuses located in Australia; Think Education, a vocational training organization; and Media Design School, which provides industry-endorsed courses in 3D animation and visual effects, game art and programming, graphic and motion design, digital media artificial intelligence, and creative advertising in New Zealand. It also offers Workforce Edge, a platform to employers that provides education benefits administration solutions; and Sophia Learning, which enables lower cost education benefits programs. Strategic Education, Inc. was founded in 1892 and is headquartered in Herndon, Virginia.

About Lixiang Education

Lixiang Education Holding Co., Ltd. provides primary and middle school education services from grade 1 to grade 9 in the People's Republic of China. As of December 31, 2020, the company operated two campuses, including Baiyun Campus and Yijing Campus. It also engages in the operation of food procurement. The company was formerly known as Lianwai Education Group Limited and changed its name to Lixiang Education Holding Co., Ltd. in May 26, 2020. The company was founded in 2001 and is headquartered in Lishui, the People's Republic of China.