Analyzing Frontdoor (NASDAQ:FTDR) & Coursera (NYSE:COUR)

Coursera (NYSE:COUR) and Frontdoor (NASDAQ:FTDR) are both consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.

Earnings & Valuation

This table compares Coursera and Frontdoor”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Coursera	$757.50 million	1.84	-$51.00 million	($0.67)	-7.87
Frontdoor	$2.15 billion	2.56	$255.00 million	$3.77	21.11

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

Institutional and Insider Ownership

89.5% of Coursera shares are held by institutional investors. 16.3% of Coursera shares are held by company insiders. Comparatively, 1.6% of Frontdoor shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

Coursera has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500. Comparatively, Frontdoor has a beta of 1.53, suggesting that its stock price is 53% more volatile than the S&P 500.

Profitability

This table compares Coursera and Frontdoor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Coursera	-15.39%	-1.72%	-1.07%
Frontdoor	12.72%	120.90%	14.86%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Coursera and Frontdoor, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Coursera	1	4	7	0	2.50
Frontdoor	0	4	4	0	2.50

Coursera currently has a consensus target price of $8.36, indicating a potential upside of 58.55%. Frontdoor has a consensus target price of $92.60, indicating a potential upside of 16.35%. Given Coursera’s higher probable upside, analysts clearly believe Coursera is more favorable than Frontdoor.

Summary

Frontdoor beats Coursera on 9 of the 13 factors compared between the two stocks.

About Coursera

Coursera, Inc. operates an online educational content platform in the United States, Europe, Africa, the Asia Pacific, the Middle East, and internationally. It operates in three segments: Consumer, Enterprise, and Degrees. The company offers guided projects, courses, and specializations, as well as online degrees; and certificates for entry-level professional, non-entry level professional, university, and MasterTrack. It offers its products to individuals, enterprise, business, campus, and government. The company was formerly known as Dkandu, Inc. and changed its name to Coursera, Inc. in April 2012. Coursera, Inc. was incorporated in 2011 and is headquartered in Mountain View, California.

About Frontdoor

Frontdoor, Inc. provides home warranties in the United States in the United States. Its customizable home warranties help customers protect and maintain their homes from costly and unplanned breakdowns of essential home systems and appliances. The company’s home warranty customers subscribe to an annual service plan agreement that covers the repair or replacement of principal components of approximately 20 home systems and appliances, including electrical, plumbing, water heaters, refrigerators, dishwashers, and ranges/ovens/cooktops, as well as electronics, pools, and spas and pumps; and heating, ventilation, and air conditioning systems. It also offers on-demand home services and a one-stop app experience for home repair and maintenance; and Streem technology, an app that empowers homeowners by connecting them in real time through video chat with qualified experts to diagnose and solve their problems. The company serves homeowners under the Frontdoor, American Home Shield, HSA, OneGuard, Landmark Home Warranty, Frontdoor logo, and Streem brands. The company was founded in 1971 and is headquartered in Memphis, Tennessee.