Educational Development (NASDAQ:EDUC – Get Free Report) and Sinclair (NASDAQ:SBGI – Get Free Report) are both small-cap communication services companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.
Analyst Recommendations
This is a summary of recent recommendations and price targets for Educational Development and Sinclair, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Educational Development | 1 | 0 | 0 | 0 | 1.00 |
| Sinclair | 2 | 2 | 2 | 0 | 2.00 |
Sinclair has a consensus target price of $19.40, suggesting a potential upside of 54.95%. Given Sinclair’s stronger consensus rating and higher possible upside, analysts plainly believe Sinclair is more favorable than Educational Development.
Institutional & Insider Ownership
19.6% of Educational Development shares are owned by institutional investors. Comparatively, 41.7% of Sinclair shares are owned by institutional investors. 11.9% of Educational Development shares are owned by insiders. Comparatively, 42.1% of Sinclair shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Profitability
This table compares Educational Development and Sinclair’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Educational Development | 8.60% | -18.72% | -14.64% |
| Sinclair | 1.60% | -16.09% | -0.95% |
Volatility & Risk
Educational Development has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, Sinclair has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.
Earnings and Valuation
This table compares Educational Development and Sinclair”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Educational Development | $22.91 million | 0.39 | $2.33 million | $0.19 | 5.47 |
| Sinclair | $3.17 billion | 0.29 | -$112.00 million | $0.75 | 16.69 |
Educational Development has higher earnings, but lower revenue than Sinclair. Educational Development is trading at a lower price-to-earnings ratio than Sinclair, indicating that it is currently the more affordable of the two stocks.
Summary
Sinclair beats Educational Development on 11 of the 14 factors compared between the two stocks.
About Educational Development
Educational Development Corporation, a publishing company, operates as a publisher of educational children's books in the United States. It operates through two segments, PaperPie and Publishing. The company offers various books, including touchy-feely board books, activity books and flashcards, adventure and search books, art books, sticker books, and foreign language books, as well as internet-linked books comprising science and math titles, and chapter books and novels. It markets its products to retail accounts, which include book, school supply, toy and gift stores and museums, through commissioned sales representatives, trade and specialty wholesalers, and its internal tele-sales group; and through a network of independent sales consultants through internet sales, direct sales, home shows, and book fairs. Educational Development Corporation was incorporated in 1965 and is headquartered in Tulsa, Oklahoma.
About Sinclair
Sinclair, Inc., a media company, provides content on local television stations and digital platforms in the United States. It operates through two segments, Local Media and Tennis. The Local Media segment operates broadcast television stations, original networks, and content; provides free-over-the-air programming and live local sporting events on its stations; distributes its content to multi-channel video programming distributors in exchange for contractual fees; and produces local and original news programs. This segment operates The Nest, a free over-the-air national broadcast TV network; Comet, a science fiction network; CHARGE!, an adventure and action-based network; and TBD, a multiscreen TV network. The Tennis segment offers Tennis Channel, a cable network which includes coverage of tennis' top tournaments and original professional sports, and tennis lifestyle shows; Tennis Channel International streaming service; Tennis Channel Plus streaming service; T2 FAST, a 24-hours a day free ad-supported streaming television channel; and Tennis.com and Pickleballtv. It also provides digital and internet solutions; and technical services, including the design and manufacture of broadcast systems. The company distributes its content through broadcast platforms and third-party platforms that consist of programming provided by third-party networks and syndicators, local news, and other original programming. Sinclair, Inc. was founded in 1971 and is headquartered in Hunt Valley, Maryland.
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