Critical Comparison: Color Star Technology (NASDAQ:ADD) & Afya (NASDAQ:AFYA)

Color Star Technology (NASDAQ:ADD) and Afya (NASDAQ:AFYA) are both small-cap business services companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, analyst recommendations and dividends.

Institutional and Insider Ownership

3.4% of Color Star Technology shares are owned by institutional investors. Comparatively, 88.0% of Afya shares are owned by institutional investors. 38.9% of Color Star Technology shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Color Star Technology and Afya, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Color Star Technology	0	0	0	0	N/A
Afya	0	3	0	0	2.00

Afya has a consensus price target of $23.00, suggesting a potential upside of 36.09%. Given Afya’s higher possible upside, analysts clearly believe Afya is more favorable than Color Star Technology.

Earnings and Valuation

This table compares Color Star Technology and Afya’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Color Star Technology	$16.52 million	0.23	-$37.85 million	N/A	N/A
Afya	$576.09 million	2.75	$77.38 million	$0.86	19.65

Afya has higher revenue and earnings than Color Star Technology.

Profitability

This table compares Color Star Technology and Afya’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Color Star Technology	N/A	N/A	N/A
Afya	13.54%	15.88%	7.16%

Volatility and Risk

Color Star Technology has a beta of 1.99, suggesting that its stock price is 99% more volatile than the S&P 500. Comparatively, Afya has a beta of 0.97, suggesting that its stock price is 3% less volatile than the S&P 500.

Summary

Afya beats Color Star Technology on 8 of the 10 factors compared between the two stocks.

About Color Star Technology

Color Star Technology Co., Ltd., an entertainment and education company, provides online entertainment performances and music education services in the United States and China. The company operates Color World, an online platform of curriculum that includes music, sports, animation, painting and calligraphy, film and television, life skills, etc. Its Color World platform provides celebrity lectures, celebrity concert videos, celebrity peripheral products, and artist interactive communication services. The company was formerly known as Huitao Technology Co., Ltd. and changed its name to Color Star Technology Co., Ltd. in May 2020. The company was founded in 2002 and is based in New York, New York.

About Afya

Afya Limited, through its subsidiaries, operates as a medical education group in Brazil. The company operates through three segments: Undergrad, Continuing Education, and Digital Services. It offers educational products and services, including medical schools, medical residency preparatory courses, graduate courses, and other programs to lifelong medical learners enrolled across its distribution network, as well as to third-party medical schools. The company also provides digital health services, such as subscription-based mobile app and website portal that focuses on assisting health professionals and students with clinical decision-making through tools, such as medical calculators, charts, and updated content, as well as prescriptions, clinical scores, medical procedures and laboratory exams, and others. It offers health sciences courses, which comprise medicine, dentistry, nursing, radiology, psychology, pharmacy, physical education, physiotherapy, nutrition, and biomedicine; and degree programs and courses in other subjects and disciplines, including undergraduate and post graduate courses in business administration, accounting, law, civil engineering, industrial engineering, and pedagogy. In addition, the company provides medical postgraduate specialization programs; printed and digital content; and an online medical education platform and practical medical training services. The company was founded in 1999 and is headquartered in Nova Lima, Brazil.