2U (NASDAQ: TWOU) is one of 186 public companies in the “IT Services & Consulting” industry, but how does it compare to its peers? We will compare 2U to similar companies based on the strength of its risk, profitability, valuation, earnings, analyst recommendations, dividends and institutional ownership.

Profitability

This table compares 2U and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
2U -12.49% -13.02% -9.97%
2U Competitors -20.11% -270.42% -4.42%

Analyst Ratings

This is a breakdown of recent ratings and target prices for 2U and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
2U 0 0 9 0 3.00
2U Competitors 725 4646 7406 167 2.54

2U currently has a consensus target price of $71.44, indicating a potential upside of 3.68%. As a group, “IT Services & Consulting” companies have a potential upside of 2.17%. Given 2U’s stronger consensus rating and higher probable upside, research analysts plainly believe 2U is more favorable than its peers.

Institutional & Insider Ownership

61.5% of shares of all “IT Services & Consulting” companies are owned by institutional investors. 8.4% of 2U shares are owned by insiders. Comparatively, 16.3% of shares of all “IT Services & Consulting” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

2U has a beta of -0.18, suggesting that its stock price is 118% less volatile than the S&P 500. Comparatively, 2U’s peers have a beta of 1.15, suggesting that their average stock price is 15% more volatile than the S&P 500.

Valuation and Earnings

This table compares 2U and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
2U $205.86 million -$20.68 million -102.85
2U Competitors $2.81 billion $293.37 million 320.48

2U’s peers have higher revenue and earnings than 2U. 2U is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

2U peers beat 2U on 7 of the 12 factors compared.

2U Company Profile

2U, Inc. is a provider of an integrated solution consisting of cloud-based software-as-a-service (SaaS) combined with technology-enabled services (together, the Platform) that allows colleges and universities to deliver online degree programs. The Company’s SaaS technology consists of a learning environment (Online Campus), which acts as the hub for all student and faculty academic and social interaction, and a suite of integrated applications, which the Company uses to launch, operate and support the Company’s clients’ programs. The Company also provides a suite of technology-enabled services optimized with data analysis and machine learning techniques that support the complete lifecycle of a higher education program, including attracting students, advising students through the admissions application process, providing technical, success coaching and other support, facilitating accessibility to individuals with disabilities, and facilitating in-program field placements.

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