Sunlands Technology Group (NYSE:STG – Get Free Report) and Sohu.com (NASDAQ:SOHU – Get Free Report) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, profitability, risk, analyst recommendations and dividends.
Analyst Ratings
This is a breakdown of recent recommendations for Sunlands Technology Group and Sohu.com, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sunlands Technology Group | 1 | 0 | 0 | 0 | 1.00 |
| Sohu.com | 0 | 1 | 2 | 0 | 2.67 |
Sohu.com has a consensus price target of $19.00, indicating a potential upside of 46.95%. Given Sohu.com’s stronger consensus rating and higher possible upside, analysts clearly believe Sohu.com is more favorable than Sunlands Technology Group.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sunlands Technology Group | $288.84 million | 0.18 | $52.28 million | $3.86 | 1.02 |
| Sohu.com | $584.33 million | 0.58 | $394.10 million | $7.84 | 1.65 |
Sohu.com has higher revenue and earnings than Sunlands Technology Group. Sunlands Technology Group is trading at a lower price-to-earnings ratio than Sohu.com, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Sunlands Technology Group has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500. Comparatively, Sohu.com has a beta of 0.38, meaning that its share price is 62% less volatile than the S&P 500.
Insider & Institutional Ownership
26.4% of Sunlands Technology Group shares are held by institutional investors. Comparatively, 33.0% of Sohu.com shares are held by institutional investors. 59.7% of Sunlands Technology Group shares are held by company insiders. Comparatively, 21.1% of Sohu.com shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Profitability
This table compares Sunlands Technology Group and Sohu.com’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sunlands Technology Group | 18.56% | 39.98% | 17.58% |
| Sohu.com | 35.19% | 20.92% | 14.76% |
Summary
Sohu.com beats Sunlands Technology Group on 10 of the 14 factors compared between the two stocks.
About Sunlands Technology Group
Sunlands Technology Group, through its subsidiaries, provides online education services through online and mobile platforms in the People's Republic of China. It offers various degree- and diploma-oriented post-secondary courses, including preparation courses for the self-taught higher education examination (STE) for learners pursuing associate diplomas or bachelor's degrees, as well as for the entrance examinations of Master of Business Administration programs. The company's STE courses include Chinese language and literature, law, pre-school education, marketing, English, human resource management, business administration, business management, modern corporate governance, financial management, advertising, accounting, administrative management, computer information management, finance, chain operation management, and visual communication and design and production. It also provides professional certification preparation courses in various industries and professions, such as accounting, human resources, teaching, and finance. In addition, the company offers education services through online and mobile platforms to adult students, pursuing post-secondary, and professional educations. The company was formerly known as Sunlands Online Education Group and changed its name to Sunlands Technology Group in August 2018. Sunlands Technology Group was founded in 2003 and is headquartered in Beijing, the People's Republic of China.
About Sohu.com
Sohu.com Limited engages in the provision of online media, video, and game products and services on personal computers (PCs) and mobile devices in China. It operates through two segments: Sohu and Changyou. The company offers online news, information, and content services through the mobile phone application Sohu News APP, mobile portal m.sohu.com, and www.sohu.com for PCs; and online video content and services through mobile phone application Sohu Video APP and tv.sohu.com, as well as ifox, a video application for PC. It also operates Focus (www.focus.cn), which provides online real estate information and services; and 17173.com website, which provides news, electronic forums, online videos, and other online game information services to game players, as well as offers mobile game distribution services. In addition, the company offers interactive online games for PCs and mobile devices. Further, it provides paid subscription and interactive broadcasting services. The company was incorporated in 1996 and is headquartered in Beijing, China.
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