TAL Education Group (NYSE: TAL) and Lincoln Educational Services Corporation (NASDAQ:LINC) are both consumer discretionary companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Analyst Recommendations

This is a breakdown of recent recommendations for TAL Education Group and Lincoln Educational Services Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TAL Education Group 0 2 9 0 2.82
Lincoln Educational Services Corporation 0 0 0 0 N/A

TAL Education Group currently has a consensus target price of $28.29, suggesting a potential downside of 16.57%. Given TAL Education Group’s higher possible upside, equities analysts clearly believe TAL Education Group is more favorable than Lincoln Educational Services Corporation.

Volatility & Risk

TAL Education Group has a beta of 0.26, indicating that its stock price is 74% less volatile than the S&P 500. Comparatively, Lincoln Educational Services Corporation has a beta of 2.81, indicating that its stock price is 181% more volatile than the S&P 500.

Profitability

This table compares TAL Education Group and Lincoln Educational Services Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TAL Education Group 11.14% 19.47% 7.05%
Lincoln Educational Services Corporation -16.19% -24.26% -8.20%

Valuation and Earnings

This table compares TAL Education Group and Lincoln Educational Services Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
TAL Education Group $1.17 billion 14.32 $182.99 million $0.24 140.32
Lincoln Educational Services Corporation $185.33 million 0.33 $6.13 million ($1.55) -1.61

TAL Education Group has higher revenue and earnings than Lincoln Educational Services Corporation. Lincoln Educational Services Corporation is trading at a lower price-to-earnings ratio than TAL Education Group, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

8.6% of TAL Education Group shares are held by institutional investors. Comparatively, 62.1% of Lincoln Educational Services Corporation shares are held by institutional investors. 6.1% of Lincoln Educational Services Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

TAL Education Group beats Lincoln Educational Services Corporation on 9 of the 12 factors compared between the two stocks.

TAL Education Group Company Profile

TAL Education Group is a holding company for a group of companies engaged in provision of after-school tutoring programs for primary and secondary school students in the People’s Republic of China (the PRC). The Company is a K-12 after-school tutoring services provider in China. The Company’s Xueersi Peiyou small classes course consists of approximately four semesters, which include approximately two school semesters in Spring and Fall, and approximately two holiday semesters in summer and winter. It operates a Website, www.jzb.com, which is an online education platform in China. It offers personalized premium services under its Zhikang brand. It offers online courses through www.xueersi.com. Through www.xueersi.com, the Company offers online courses on mathematics, English, Chinese, physics, chemistry, biology and other subjects. It also offers select online courses through other Websites. The Company has over 10 call centers in Beijing, Shanghai, Tianjin, Guangzhou and Shenzhen.

Lincoln Educational Services Corporation Company Profile

Lincoln Educational Services Corporation is a provider of post-secondary education. The Company operates in two segments: Transportation and Skilled Trades, and Transitional. The Transportation and Skilled Trades segment offers academic programs in the disciplines of transportation and skilled trades (automotive, diesel, heating, ventilation and air conditioning (HVAC), welding and manufacturing). The Transitional segment includes operations that are being phased out and consists of its campus that is being taught out. It offers programs in automotive technology, skilled trades, which include HVAC, welding and computerized numerical control and electronic systems technology; healthcare services, which include nursing, dental assistant and pharmacy technician; hospitality services, which include culinary, therapeutic massage, cosmetology and aesthetics, and business and information technology, which includes information technology and criminal justice programs.

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