Crexendo (NASDAQ:CXDO) and Sunlands Technology Group (NYSE:STG) Critical Survey

Sunlands Technology Group (NYSE:STG) and Crexendo (NASDAQ:CXDO) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Profitability

This table compares Sunlands Technology Group and Crexendo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sunlands Technology Group	18.06%	44.02%	17.28%
Crexendo	7.44%	13.74%	11.22%

Earnings and Valuation

This table compares Sunlands Technology Group and Crexendo”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sunlands Technology Group	$288.84 million	0.17	$52.28 million	$3.80	0.96
Crexendo	$68.17 million	2.74	$5.07 million	$0.17	35.24

Sunlands Technology Group has higher revenue and earnings than Crexendo. Sunlands Technology Group is trading at a lower price-to-earnings ratio than Crexendo, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

26.4% of Sunlands Technology Group shares are held by institutional investors. Comparatively, 9.5% of Crexendo shares are held by institutional investors. 59.7% of Sunlands Technology Group shares are held by company insiders. Comparatively, 47.2% of Crexendo shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Sunlands Technology Group has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500. Comparatively, Crexendo has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for Sunlands Technology Group and Crexendo, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sunlands Technology Group	1	0	0	0	1.00
Crexendo	0	1	5	0	2.83

Crexendo has a consensus price target of $9.17, suggesting a potential upside of 53.03%. Given Crexendo’s stronger consensus rating and higher possible upside, analysts clearly believe Crexendo is more favorable than Sunlands Technology Group.

Summary

Sunlands Technology Group beats Crexendo on 8 of the 14 factors compared between the two stocks.

About Sunlands Technology Group

Sunlands Technology Group, through its subsidiaries, provides online education services through online and mobile platforms in the People's Republic of China. It offers various degree- and diploma-oriented post-secondary courses, including preparation courses for the self-taught higher education examination (STE) for learners pursuing associate diplomas or bachelor's degrees, as well as for the entrance examinations of Master of Business Administration programs. The company's STE courses include Chinese language and literature, law, pre-school education, marketing, English, human resource management, business administration, business management, modern corporate governance, financial management, advertising, accounting, administrative management, computer information management, finance, chain operation management, and visual communication and design and production. It also provides professional certification preparation courses in various industries and professions, such as accounting, human resources, teaching, and finance. In addition, the company offers education services through online and mobile platforms to adult students, pursuing post-secondary, and professional educations. The company was formerly known as Sunlands Online Education Group and changed its name to Sunlands Technology Group in August 2018. Sunlands Technology Group was founded in 2003 and is headquartered in Beijing, the People's Republic of China.

About Crexendo

Crexendo, Inc. provides cloud communication platform and services, video collaboration, and managed IT services for businesses in the United States and internationally. It operates through two segments, Cloud Telecommunications Services and Software Solutions. The Cloud Telecommunications segment provides telecommunications services that transmit calls using Internet protocol (IP) or cloud technology, which converts voice signals into digital data packets for transmission over the Internet or cloud; and broadband Internet services, as well as develops end user portals for account and license management, and billing and customer support. This segment is also involved in the sale and lease of cloud telecommunications equipment. In addition, it offers hardware, software, and unified communication solutions for businesses using IP or cloud technology over high-speed internet connection through various devices and user interfaces, such as desktop phones and/or mobile, and desktop applications under the Crexendo brand name. The Software Solutions segment provides a suite of unified communications, collaboration, video conferencing, and contact center solutions. This segment also offers SNAPsolution, an IP-based platform; SNAPaccel, a software-as-a-service based software; subscription maintenance and support services; and professional services, including consulting, technical support, resident engineer, design, and installation services. The company was formerly known as iMergent, Inc. and changed its name to Crexendo, Inc. in May 2011. Crexendo, Inc. was incorporated in 1995 and is based in Tempe, Arizona.