2U (NASDAQ:TWOU) and Momo (NASDAQ:MOMO) Financial Survey

2U (NASDAQ:TWOU) and Momo (NASDAQ:MOMO) are both computer and technology companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Profitability

This table compares 2U and Momo’s net margins, return on equity and return on assets.

Volatility & Risk

2U has a beta of 0.6, meaning that its share price is 40% less volatile than the S&P 500. Comparatively, Momo has a beta of 2.18, meaning that its share price is 118% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for 2U and Momo, as reported by MarketBeat.

2U currently has a consensus price target of $41.00, suggesting a potential upside of 90.61%. Momo has a consensus price target of $44.73, suggesting a potential upside of 20.38%. Given 2U’s higher possible upside, analysts plainly believe 2U is more favorable than Momo.

Institutional & Insider Ownership

59.3% of Momo shares are held by institutional investors. 4.9% of 2U shares are held by insiders. Comparatively, 61.4% of Momo shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares 2U and Momo’s gross revenue, earnings per share (EPS) and valuation.

Momo has higher revenue and earnings than 2U. 2U is trading at a lower price-to-earnings ratio than Momo, indicating that it is currently the more affordable of the two stocks.

Summary

Momo beats 2U on 12 of the 13 factors compared between the two stocks.

About 2U

2U, Inc. operates as an education technology company in the United States, Hong Kong, South Africa, and the United Kingdom. The company operates through two segments, Graduate Program Segment and Short Course Segment. It offers front-end technology and services, including online learning platform, student and faculty and immersion support, accessibility, admissions application advising, in-program student field placements, and faculty recruiting. The company provides back-end technology and services comprising graduate program launch and operations applications, university systems integration applications, content management system, admission application processing portal, customer relationship management, content development, student acquisition, and state authorization services. The company was formerly known as 2Tor Inc. and changed its name to 2U, Inc. in October 2012. 2U, Inc. was founded in 2008 and is headquartered in Lanham, Maryland.

About Momo

Momo Inc. operates a mobile-based social and entertainment platform in the People’s Republic of China. The company operates Momo platform that includes its Momo mobile application and various related features, functionalities, tools, and services to users, customers, and platform partners. It offers Momo mobile application that enables users to establish and expand their social relationships based on locations; interests; and recreational activities, including live talent shows, short videos, social games, and other video- and audio-based interactive experiences. The company also operates Tantan, a social and dating app to help its users to find and establish romantic connections, as well as to meet interesting people primarily for young mobile Internet users. The company was formerly known as Momo Technology Company Limited and changed its name to Momo Inc. in July 2014. Momo Inc. was founded in 2011 and is headquartered in Beijing, the People’s Republic of China.

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