YOUDAO INC - ADR (DAO)

US98741T1043 - ADR

7.4  +0.48 (+6.94%)

Premarket: 6.97 -0.43 (-5.81%)

Fundamental Rating

2

Taking everything into account, DAO scores 2 out of 10 in our fundamental rating. DAO was compared to 70 industry peers in the Diversified Consumer Services industry. Both the profitability and financial health of DAO have multiple concerns. DAO is not valued too expensively and it also shows a decent growth rate.



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1

1. Profitability

1.1 Basic Checks

DAO had positive earnings in the past year.
In the past year DAO has reported a negative cash flow from operations.
DAO had negative earnings in each of the past 5 years.
DAO had a negative operating cash flow in each of the past 5 years.

1.2 Ratios

The Return On Assets of DAO (-33.01%) is worse than 76.19% of its industry peers.
Industry RankSector Rank
ROA -33.01%
ROE N/A
ROIC N/A
ROA(3y)-34.25%
ROA(5y)-43.59%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A

1.3 Margins

The Gross Margin of DAO (51.35%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of DAO has grown nicely.
DAO does not have Profit Margin and Operating Margin available, so we won't be analyzing them here.
Industry RankSector Rank
OM N/A
PM (TTM) N/A
GM 51.35%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.42%
GM growth 5Y11.65%

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0

2. Health

2.1 Basic Checks

DAO does not have a ROIC to compare to the WACC, probably because it is not profitable.
DAO has less shares outstanding than it did 1 year ago.
DAO has more shares outstanding than it did 5 years ago.
DAO has a worse debt/assets ratio than last year.

2.2 Solvency

Based on the Altman-Z score of -2.97, we must say that DAO is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of DAO (-2.97) is worse than 77.78% of its industry peers.
Industry RankSector Rank
Debt/Equity N/A
Debt/FCF N/A
Altman-Z -2.97
ROIC/WACCN/A
WACC6.98%

2.3 Liquidity

DAO has a Current Ratio of 0.42. This is a bad value and indicates that DAO is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.42, DAO is doing worse than 92.06% of the companies in the same industry.
A Quick Ratio of 0.35 indicates that DAO may have some problems paying its short term obligations.
The Quick ratio of DAO (0.35) is worse than 93.65% of its industry peers.
Industry RankSector Rank
Current Ratio 0.42
Quick Ratio 0.35

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6

3. Growth

3.1 Past

DAO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 116.39%, which is quite impressive.
Looking at the last year, DAO shows a small growth in Revenue. The Revenue has grown by 7.50% in the last year.
DAO shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 49.09% yearly.
EPS 1Y (TTM)116.39%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%238.18%
Revenue 1Y (TTM)7.5%
Revenue growth 3Y28.72%
Revenue growth 5Y49.09%
Sales Q2Q%2.19%

3.2 Future

DAO is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 41.23% yearly.
Based on estimates for the next years, DAO will show a quite strong growth in Revenue. The Revenue will grow by 13.04% on average per year.
EPS Next Y89.73%
EPS Next 2Y52.53%
EPS Next 3Y41.23%
EPS Next 5YN/A
Revenue Next Year10.81%
Revenue Next 2Y12.39%
Revenue Next 3Y13.04%
Revenue Next 5YN/A

3.3 Evolution

Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

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6

4. Valuation

4.1 Price/Earnings Ratio

DAO is valuated reasonably with a Price/Earnings ratio of 10.72.
Based on the Price/Earnings ratio, DAO is valued cheaper than 92.06% of the companies in the same industry.
When comparing the Price/Earnings ratio of DAO to the average of the S&P500 Index (27.17), we can say DAO is valued rather cheaply.
A Price/Forward Earnings ratio of 5.84 indicates a rather cheap valuation of DAO.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DAO indicates a rather cheap valuation: DAO is cheaper than 98.41% of the companies listed in the same industry.
DAO is valuated cheaply when we compare the Price/Forward Earnings ratio to 23.59, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 10.72
Fwd PE 5.84

4.2 Price Multiples

Industry RankSector Rank
P/FCF N/A
EV/EBITDA N/A

4.3 Compensation for Growth

DAO's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
DAO's earnings are expected to grow with 41.23% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.12
PEG (5Y)N/A
EPS Next 2Y52.53%
EPS Next 3Y41.23%

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0

5. Dividend

5.1 Amount

DAO does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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YOUDAO INC - ADR

NYSE:DAO (12/31/2024, 8:18:03 PM)

Premarket: 6.97 -0.43 (-5.81%)

7.4

+0.48 (+6.94%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)11-14 2024-11-14/bmo
Earnings (Next)N/A N/A
Inst Owners47.68%
Inst Owner Change-3.05%
Ins Owners4.35%
Ins Owner ChangeN/A
Market Cap884.44M
Analysts85.71
Price Target6.43 (-13.11%)
Short Float %0.89%
Short Ratio2.08
Dividend
Industry RankSector Rank
Dividend Yield N/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)60.66%
Min EPS beat(2)37.26%
Max EPS beat(2)84.06%
EPS beat(4)3
Avg EPS beat(4)28.35%
Min EPS beat(4)-22.04%
Max EPS beat(4)84.06%
EPS beat(8)5
Avg EPS beat(8)34.49%
EPS beat(12)8
Avg EPS beat(12)30.9%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-85.62%
Min Revenue beat(2)-86.13%
Max Revenue beat(2)-85.12%
Revenue beat(4)0
Avg Revenue beat(4)-85.78%
Min Revenue beat(4)-86.13%
Max Revenue beat(4)-85.12%
Revenue beat(8)0
Avg Revenue beat(8)-85.93%
Revenue beat(12)0
Avg Revenue beat(12)-87.24%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)8.85%
PT rev (3m)21.13%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)33.92%
EPS NY rev (3m)38.04%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)-0.27%
Revenue NY rev (3m)0.57%
Valuation
Industry RankSector Rank
PE 10.72
Fwd PE 5.84
P/S 1.2
P/FCF N/A
P/OCF N/A
P/B N/A
P/tB N/A
EV/EBITDA N/A
EPS(TTM)0.69
EY9.32%
EPS(NY)1.27
Fwd EY17.12%
FCF(TTM)-0.52
FCFYN/A
OCF(TTM)-0.5
OCFYN/A
SpS6.18
BVpS-2.51
TBVpS-2.63
PEG (NY)0.12
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -33.01%
ROE N/A
ROCE N/A
ROIC N/A
ROICexc N/A
ROICexgc N/A
OM N/A
PM (TTM) N/A
GM 51.35%
FCFM N/A
ROA(3y)-34.25%
ROA(5y)-43.59%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y5.42%
GM growth 5Y11.65%
F-Score3
Asset Turnover3.23
Health
Industry RankSector Rank
Debt/Equity N/A
Debt/FCF N/A
Debt/EBITDA N/A
Cap/Depr 60.22%
Cap/Sales 0.33%
Interest Coverage N/A
Cash Conversion N/A
Profit Quality N/A
Current Ratio 0.42
Quick Ratio 0.35
Altman-Z -2.97
F-Score3
WACC6.98%
ROIC/WACCN/A
Cap/Depr(3y)146.12%
Cap/Depr(5y)167.78%
Cap/Sales(3y)1.11%
Cap/Sales(5y)1.26%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)116.39%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%238.18%
EPS Next Y89.73%
EPS Next 2Y52.53%
EPS Next 3Y41.23%
EPS Next 5YN/A
Revenue 1Y (TTM)7.5%
Revenue growth 3Y28.72%
Revenue growth 5Y49.09%
Sales Q2Q%2.19%
Revenue Next Year10.81%
Revenue Next 2Y12.39%
Revenue Next 3Y13.04%
Revenue Next 5YN/A
EBIT growth 1Y39.8%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year125.53%
EBIT Next 3Y47.95%
EBIT Next 5YN/A
FCF growth 1Y32.23%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y27.35%
OCF growth 3YN/A
OCF growth 5YN/A