LAIX (NYSE:LAIX) and Youdao (NYSE:DAO) are both small-cap business services companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, earnings, institutional ownership and profitability.

Valuation and Earnings

This table compares LAIX and Youdao’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LAIX $92.68 million 2.38 -$70.99 million ($2.79) -1.65
Youdao $106.57 million 16.93 -$30.43 million N/A N/A

Youdao has higher revenue and earnings than LAIX.

Analyst Ratings

This is a summary of recent ratings for LAIX and Youdao, as provided by

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LAIX 1 1 0 0 1.50
Youdao 0 0 2 0 3.00

LAIX presently has a consensus price target of $4.75, indicating a potential upside of 3.26%. Youdao has a consensus price target of $18.80, indicating a potential upside of 16.48%. Given Youdao’s stronger consensus rating and higher possible upside, analysts clearly believe Youdao is more favorable than LAIX.

Insider and Institutional Ownership

14.0% of LAIX shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.


This table compares LAIX and Youdao’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LAIX -51.95% -590.12% -49.98%
Youdao N/A N/A N/A


Youdao beats LAIX on 9 of the 10 factors compared between the two stocks.

LAIX Company Profile

LAIX Inc., an artificial intelligence company, provides online English learning services through Liulishuo mobile app in the People's Republic of China. It is also involved in the artificial intelligence lab operation; technology development; and loan arrangement activities. The company was formerly known as LingoChamp Inc. LAIX Inc. was founded in 2013 and is headquartered in Shanghai, the People's Republic of China.

Youdao Company Profile

Youdao, Inc., an Internet technology company, provides online services in content, community, communication, and commerce in China. The company provides various learning content, applications, and solutions, which covers topics and targets people from various age groups for their learning needs through its websites and mobile applications. Its learning services and products primarily include online courses, fee-based premium services, and others, as well as online marketing services. The company also provides sales of smart devices and solutions, and technical supporting to the VIE; consulting services; and online learning services, as well as online marketing services. Youdao, Inc. was founded in 2006 and is based in Hangzhou, China.

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