China Online Education Group (COE) AI Stock Analysis

• Market Cap: $281.20M
• Dividend Yield: N/A
• Average Volume (3M): 15.57K
• Price to Earnings (P/E): ―
• Beta (1Y): -0.33
• Revenue Growth: 91.86%
• EPS Growth: 52.66%
• Country: US
• Employees: 360
• Sector: Consumer Defensive
• Sector Strength: 45
• Industry: Software - Application
• EPS (TTM): -0.52
• Shares Outstanding: 4,132,692
• 10 Day Avg. Volume: 17,447
• 30 Day Avg. Volume: 15,566
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 0.59
• Enterprise Value/Revenue: 6.72
• Enterprise Value/Gross Profit: 8.65
• Enterprise Value/Ebitda: -14.39
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 48 Neutral
• Price Target: ―

China Online Education Group's strong revenue growth and improved cash flow are offset by persistent profitability and solvency issues. The technical analysis suggests some upward momentum, though caution is advised due to potential overbought conditions. The negative P/E ratio and lack of dividend yield weigh on valuation. Overall, while there are positive developments, significant financial risks remain.

China Online Education Group Business Overview & Revenue Model

Company Description

51Talk Online Education Group engages in the operation of an online education platform in China. It operates under the China and Philippines geographical segments. Its online and mobile education platforms enable students across China to take live interactive english lessons with overseas foreign teachers on demand. The company was founded by Jia Jia Huang, Ting Shu, and Li Ming Zhang in July 2011 and is headquartered in Singapore.

How the Company Makes Money

China Online Education Group makes money through a subscription-based revenue model. Students pay for English language courses, which are offered as packages with varying numbers of lessons. The company generates revenue from these prepaid lesson packages, which are typically sold in bulk to encourage commitment and retention. Additionally, COE may earn from premium services or products, such as specialized curriculum offerings or advanced learning tools. Strategic partnerships with educational content providers and technology firms can also contribute to revenue, enhancing the platform's offerings and attracting more students. The company's growth and profitability are driven by student enrollment numbers, lesson package sales, and effective cost management.

China Online Education Group Financial Statement Overview

Summary

China Online Education Group shows strong revenue growth but struggles with profitability and solvency. The negative equity and consistent operating losses pose significant risks, despite recent improvements in cash flow.

Income Statement

The revenue growth from 2023 to 2024 was significant, with a 87% increase, indicating recovery. However, the company has persistent issues with profitability as evidenced by negative EBIT and net profit margins. Despite the revenue growth, the company's profitability metrics remain weak, with consistent losses impacting the overall financial health.

Balance Sheet

The balance sheet shows a concerning negative stockholders' equity, indicating that liabilities exceed assets by a significant margin. The debt-to-equity ratio cannot be calculated due to negative equity, and the equity ratio is negative, reflecting high financial risk. These factors highlight potential solvency issues.

Cash Flow

The cash flow statement shows improvement in operating cash flow and free cash flow from 2023 to 2024, indicating better cash management. The free cash flow to net income ratio is positive, but the overall cash flow situation is constrained by the company's negative net income and past cash flow deficits.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	50.69M	27.11M	15.05M	339.90M	314.40M
Gross Profit	39.53M	20.79M	11.85M	252.36M	225.56M
EBITDA	-7.91M	-13.56M	-12.26M	-4.50M	21.88M
Net Income	-7.24M	-15.03M	-12.84M	18.74M	21.24M
Balance Sheet
Total Assets	43.94M	31.16M	27.63M	187.26M	338.20M
Cash, Cash Equivalents and Short-Term Investments	29.19M	23.39M	23.06M	131.96M	201.08M
Total Debt	2.68M	631.00K	734.00K	6.08M	14.78M
Total Liabilities	58.65M	39.35M	21.06M	303.05M	470.89M
Stockholders Equity	-15.00M	-8.34M	6.58M	―	―
Cash Flow
Free Cash Flow	5.52M	272.00K	-45.71M	―	105.63M
Operating Cash Flow	5.83M	559.00K	-45.70M	―	110.09M
Investing Cash Flow	468.00K	2.45M	2.51M	99.45M	―
Financing Cash Flow	240.00K	0.00	20.48M	―	1.65M

China Online Education Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 47.99
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COE, the sentiment is Positive. The current price of 47.99 is above the 20-day moving average (MA) of 36.00, above the 50-day MA of 32.44, and above the 200-day MA of 22.83, indicating a bullish trend. The MACD of 3.16 indicates Negative momentum. The RSI at 85.25 is Negative, neither overbought nor oversold. The STOCH value of 88.09 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for COE.

China Online Education Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STG	80 Outperform	$117.63M	2.44	54.65%	―	-3.74%	-26.52%
IH	75 Outperform	$141.17M	10.39	11.29%	3.10%	-9.70%	-30.98%
COUR	73 Outperform	$1.84B	―	-8.40%	―	7.10%	49.18%
Sector *	63 Neutral	$20.52B	14.79	-2.72%	3.09%	1.95%	-4.74%
GOTU	52 Neutral	$874.65M	―	-32.95%	―	56.38%	-16.84%
DAO	52 Neutral	$1.04B	32.63	25.15%	―	-1.66%	―
COE	48 Neutral	$281.20M	―	180.24%	―	91.86%	52.66%