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China Online Education Group (COE)
:COE
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China Online Education Group
(NYSE MKT:COE)
Rating:48Neutral
Price Target:―
China Online Education Group (COE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$193.36M
Dividend YieldN/A
Average Volume (3M)17.41K
Price to Earnings (P/E)―
Beta (1Y)0.02
Revenue Growth85.68%
EPS Growth50.06%
CountryUS
Employees360
SectorTechnology
Sector Strength86
IndustryEducation & Training Services
Share Statistics
EPS (TTM)-0.25
Shares Outstanding4,132,692
10 Day Avg. Volume18,819
30 Day Avg. Volume17,415
Financial Highlights & Ratios
PEG Ratio0.98
Price to Book (P/B)321.50
Price to Sales (P/S)0.00
P/FCF Ratio-46.26
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
China Online Education Group Business Overview & Revenue Model
Company DescriptionChina Online Education Group, through its subsidiaries, provides online English language education services to students in the People's Republic of China, the Philippines, and internationally. The company operates online and mobile education platforms that enable students to take live interactive English lessons with international teachers. Its flagship courses include Classic English Junior and Classic English for the development of English communication skills. It also offers Small Class lessons and programs; 51 Talk New Concept English course; and various specialty courses, such as Business English, IELTS Speaking, Free-talk, Interview English, Travel English, and Daily English for situation-based English education. China Online Education Group was founded in 2011 and is headquartered in Shenzhen, the People's Republic of China.
How the Company Makes MoneyChina 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 Earnings Call Summary
Earnings Call Date:Jun 09, 2025
(Q1-2025)
| % Change Since: 34.36%|
Next Earnings Date:Aug 22, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive sentiment due to significant growth in gross billings and net revenues, along with improved operating and net loss figures. However, there are concerns regarding increased operating expenses, particularly in sales and marketing.Q1-2025 Updates
Positive Updates
Significant Increase in Gross Billings
First quarter gross billings increased by 74.6% compared to the same period last year, reaching USD 21.9 million.
Surge in Net Revenues
First quarter net revenues were USD 18.2 million, reflecting a 93.1% increase from the same quarter last year.
Improvement in Operating Loss and Net Loss
Q1 operating loss was USD 1.3 million, while net loss attributable to ordinary shareholders was USD 1.5 million, a 67.6% and 53.2% decrease from the same quarter last year, respectively.
Strong Gross Margin
Gross margin for the first quarter was 77%.
Negative Updates
Increase in Operating Expenses
Q1 operating expenses were USD 15.3 million, a 35.6% increase compared to the same quarter last year.
Rise in Sales and Marketing Costs
Q1 sales and marketing expenses were USD 11.1 million, a 42.7% increase from the same quarter last year, due to higher personnel costs and marketing activities.
Increased Product Development and Administrative Expenses
Q1 product development expenses increased by 9.8% to USD 1 million, and general and administrative expenses increased by 23.8% to USD 3.2 million from the same quarter last year.
Company Guidance
During the first quarter of 2025 earnings call for 51Talk Online Education Group, significant metrics were shared, indicating robust growth and strategic positioning in the market. The company's gross billings grew by an impressive 74.6% year-over-year, reaching USD 21.9 million, while net revenues surged by 93.1% to USD 18.2 million. The gross margin was reported at 77%, demonstrating operational efficiency. Despite a 35.6% increase in operating expenses, primarily due to a 42.7% rise in sales and marketing costs, the company managed to significantly reduce its operating loss and net loss attributable to ordinary shareholders by 67.6% and 53.2%, respectively. Looking ahead, 51Talk projects second-quarter gross billings between USD 24.5 million and USD 25.5 million, reflecting their optimistic outlook and strategic advancements in key markets. Additionally, the company reported having USD 29.5 million in cash, cash equivalents, and time deposits, with student advances totaling USD 47.9 million at the end of Q1.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.40
Negative
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.15
Very Negative
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.50
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 24.69M | 50.69M | 27.11M | 15.05M | 339.90M | 314.40M |
| Gross Profit | 19.18M | 39.53M | 20.79M | 11.85M | 252.36M | 225.56M |
| EBITDA | -11.53M | -7.91M | -13.56M | -12.26M | -4.50M | 21.88M |
| Net Income | -11.00M | -7.24M | -15.03M | -12.84M | 18.74M | 21.24M |
Balance Sheet | ||||||
| Total Assets | 29.80M | 43.94M | 31.16M | 27.63M | 187.26M | 338.20M |
| Cash, Cash Equivalents and Short-Term Investments | 22.85M | 29.19M | 23.39M | 23.06M | 131.96M | 201.08M |
| Total Debt | 615.00K | 2.68M | 631.00K | 734.00K | 6.08M | 14.78M |
| Total Liabilities | 32.41M | 58.65M | 39.35M | 21.06M | 303.05M | 470.89M |
| Stockholders Equity | -2.62M | -15.00M | -8.34M | 6.58M | ― | ― |
Cash Flow | ||||||
| Free Cash Flow | -167.41M | 5.52M | 272.00K | -45.71M | ― | 105.63M |
| Operating Cash Flow | -170.73M | 5.83M | 559.00K | -45.70M | ― | 110.09M |
| Investing Cash Flow | 166.64M | 468.00K | 2.45M | 2.51M | 99.45M | ― |
| Financing Cash Flow | 32.03M | 240.00K | 0.00 | 20.48M | ― | 1.65M |
China Online Education Group Technical Analysis
Positive
33.00
Price Trends
22.47
Positive
21.14
Positive
18.80
Positive
Market Momentum
3.22
Negative
80.37
Negative
79.34
Neutral
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 33 is above the 20-day moving average (MA) of 28.34, above the 50-day MA of 22.47, and above the 200-day MA of 18.80, indicating a bullish trend. The MACD of 3.22 indicates Negative momentum. The RSI at 80.37 is Negative, neither overbought nor oversold. The STOCH value of 79.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for COE.
China Online Education Group Risk Analysis
China Online Education Group disclosed 68 risk factors in its most recent earnings report. China Online Education Group reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
China Online Education Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Performance Comparison
COE
China Online Education Group
33.00
22.12
203.31%
BTCM
BIT Mining
2.02
-0.94
-31.76%
STG
Sunlands Online Education Group
5.72
-2.13
-27.13%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.