KinderCare Learning Companies (NYSE:KLC) vs. New Oriental Education & Technology Group (NYSE:EDU) Financial Analysis

KinderCare Learning Companies (NYSE:KLC) and New Oriental Education & Technology Group (NYSE:EDU) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Risk and Volatility

KinderCare Learning Companies has a beta of 3.78, suggesting that its stock price is 278% more volatile than the S&P 500. Comparatively, New Oriental Education & Technology Group has a beta of 0.23, suggesting that its stock price is 77% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for KinderCare Learning Companies and New Oriental Education & Technology Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
KinderCare Learning Companies	4	5	1	0	1.70
New Oriental Education & Technology Group	0	2	4	1	2.86

KinderCare Learning Companies currently has a consensus target price of $4.13, suggesting a potential upside of 73.11%. New Oriental Education & Technology Group has a consensus target price of $61.92, suggesting a potential upside of 10.93%. Given KinderCare Learning Companies’ higher possible upside, equities analysts plainly believe KinderCare Learning Companies is more favorable than New Oriental Education & Technology Group.

Profitability

This table compares KinderCare Learning Companies and New Oriental Education & Technology Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
KinderCare Learning Companies	-17.23%	6.65%	1.21%
New Oriental Education & Technology Group	8.39%	11.32%	5.84%

Valuation & Earnings

This table compares KinderCare Learning Companies and New Oriental Education & Technology Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
KinderCare Learning Companies	$2.74 billion	0.10	-$112.88 million	($3.98)	-0.60
New Oriental Education & Technology Group	$5.66 billion	1.56	$475.17 million	$2.96	18.86

New Oriental Education & Technology Group has higher revenue and earnings than KinderCare Learning Companies. KinderCare Learning Companies is trading at a lower price-to-earnings ratio than New Oriental Education & Technology Group, indicating that it is currently the more affordable of the two stocks.

Summary

New Oriental Education & Technology Group beats KinderCare Learning Companies on 11 of the 13 factors compared between the two stocks.

About KinderCare Learning Companies

KinderCare Learning Companies Inc. is a provider of high-quality early childhood education by center capacity. KinderCare Learning Companies Inc. is based in PORTLAND, Ore.

About New Oriental Education & Technology Group

New Oriental Education & Technology Group, Inc. is a holding company, which engages in the provision of private educational services. It operates through the following segments: Educational Services and Test Preparation Courses, Private Label Products and Livestreaming E-Commerce, Overseas Study Consulting Services, and Educational Materials and Distribution. The company was founded by Min Hong Yu and Yong Qiang Qian on November 16, 1993, and is headquartered in Beijing, China.