DAO

Youdao

Fundamental data last updated:April 13, 2026

We may earn a commission from partner links. This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate.

company profile

SECTOR

Consumer Defensive

industry

Education & Training Services

Exchange

NYSE

County of HQ

China

Next Earnings Date

05/21/26

Business Summary

Youdao operates digital education platforms and learning services, monetizing through course fees, premium content, and scalable online tools. The business model hinges on aggregating large student bases and leveraging technology to deliver standardized and personalized instruction at low incremental cost. Its moat, when functioning properly, comes from content libraries, brand recognition in test prep and digital learning, and platform stickiness among students. Cash generation depends on converting enrolled users into recurring paid subscribers while maintaining cost discipline in content production and platform development.

 


Analyze DAO on TradingView

VALUATION

P/E

55.3

Market Cap ($M USD)

$1,162

Forward P/E

3.6

PEG

0.2

PRICE TO SALES

1.4

PRICE TO BOOK

-

EV / EBITDA

43.5

5-Year Average P/E

Free Cash Flow Yield

DCF Value

Graham Number

Price to FCF

EV to FCF

Earnings Yield

FCF Yield

DIVIDEND

Yield

-

Annual Payout

-

Payout Ratio

-

Consecutive Years of Dividend Growth

0

5-Year Dividend Growth Rate

-

Financial Health & Profitability

Earnings Per Share

$0.18

Next Year EPS Growth Estimate

$2.69

Next Year Revenue Growth Estimate

13.60%

Return on Equity (ROE)

-7.00%

FREE CASH FLOW

Operating Margin

4.50%

Debt-to-Equity

-

Piotroski F-Score

3

Altman Z-Score

4.2

Return on Invested Capital (ROIC)

-95.70%

Current Ratio

0.5

Quick Ratio

Net Debt to EBITDA

Interest Coverage

Gross Profit margin

FCF PER SHARE

REVENUE PER SHARE

Analyze DAO on TradingView

Gainseekers Quantitative Analysis

Summary

At $1,162M market cap, DAO Youdao is priced like a distressed asset wearing a growth multiple. A trailing P/E of 55.3 against a Forward P/E of 3.6 and PEG Forward of 0.2 screams extreme earnings inflection, yet the quality of those earnings is questionable given a -7.00% operating margin and -95.70% ROIC. The Altman Z-Score of 4.2 signals low bankruptcy risk, so this is not a balance-sheet death spiral, but a Current Ratio of 0.5 and Debt/Equity of 4.50% show tight liquidity and leveraged fragility. The market is not mispricing safety — it is discounting operating weakness — but if forward earnings materialize, the stock is statistically cheap.

AI Exposure / Tech Reliance

As an Education & Training Services company in the Consumer Defensive sector, Youdao operates in a domain being aggressively reshaped by AI-driven tutoring, adaptive testing, and digital learning platforms. The ability to integrate AI into curriculum delivery and personalization is no longer optional in this industry. Firms that execute well can scale content at low marginal cost, but laggards will see margins compress further.

The Bull Case

A deep value or GARP investor buys this purely on the violent valuation disconnect: a Forward P/E of 3.6 and PEG Forward of 0.2 imply the market expects earnings to collapse despite EPS Next Year (Est.) at $0.18 and Sales Growth Next Year of $2.69. Return on Equity at 13.60% shows the company can generate shareholder returns despite operational inefficiencies, and an Altman Z-Score of 4.2 reduces solvency anxiety. Even with a weak Piotroski F-Score of 3, the statistical cheapness relative to forward earnings could justify multiple expansion if margins merely stabilize from -7.00%. This is a classic “ugly duckling” setup: hated, low expectations, but mathematically inexpensive if forward numbers hold.

The Bear Case

The red flags are structural and severe. Operating Margin at -7.00% combined with ROIC of -95.70% indicates capital is being destroyed at an alarming rate, and a Current Ratio of 0.5 suggests liquidity stress. Debt/Equity at 4.50% amplifies that risk, especially with no dividend support and a Piotroski F-Score of 3 signaling weak fundamental momentum. A trailing P/E of 55.3 for a business with negative operating margin is not growth pricing — it’s distorted earnings quality — and if the forward EPS of $0.18 misses, the 3.6 Forward P/E collapses into a value trap instantly.

Market Sentiment & Smart Money

Short Interest %

4.20%

Analyst Consensus

1

Average Analyst Price Target

$11.60

Institutional Ownership %

30.60%

1-Year Beta

0.7

Insider Buying % (6 Mo)

13.60%%

Distance to 52-Week High

75.00%

Distance to 52-Week Low

147.20%

EARNINGS SURPRISE %

50-DAY SMA

200-DAY SMA

⚠️ Financial Disclaimer:
This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.