2U INC (TWOU)
US90214J1016 - Common Stock
We assign a fundamental rating of 1 out of 10 to TWOU. TWOU was compared to 66 industry peers in the Diversified Consumer Services industry. Both the profitability and financial health of TWOU have multiple concerns. TWOU has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year TWOU has reported negative net income.
TWOU had a positive operating cash flow in the past year.
TWOU had negative earnings in each of the past 5 years.
In multiple years TWOU reported negative operating cash flow during the last 5 years.
1.2 Ratios
TWOU's Return On Assets of -22.21% is on the low side compared to the rest of the industry. TWOU is outperformed by 67.19% of its industry peers.
The Return On Equity of TWOU (-188.75%) is worse than 78.13% of its industry peers.
With a Return On Invested Capital value of 0.01%, TWOU perfoms like the industry average, outperforming 48.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -22.21% | ||
| ROE | -188.75% | ||
| ROIC | 0.01% |
ROA(3y)-16.26%
ROA(5y)-16.52%
ROE(3y)-77.58%
ROE(5y)-57.76%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
TWOU has a Operating Margin (0.01%) which is comparable to the rest of the industry.
Looking at the Gross Margin, with a value of 54.64%, TWOU is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
TWOU's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 0.01% | ||
| PM (TTM) | N/A | ||
| GM | 54.64% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.9%
GM growth 5Y-2.84%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TWOU is destroying value.
TWOU has more shares outstanding than it did 1 year ago.
TWOU has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, TWOU has a worse debt to assets ratio.
2.2 Solvency
TWOU has an Altman-Z score of -0.89. This is a bad value and indicates that TWOU is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of -0.89, TWOU is doing worse than 70.31% of the companies in the same industry.
TWOU has a Debt/Equity ratio of 5.33. This is a high value indicating a heavy dependency on external financing.
TWOU has a Debt to Equity ratio of 5.33. This is amonst the worse of the industry: TWOU underperforms 82.81% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.33 | ||
| Debt/FCF | N/A | ||
| Altman-Z | -0.89 |
ROIC/WACC0
WACC5.62%
2.3 Liquidity
TWOU has a Current Ratio of 0.91. This is a bad value and indicates that TWOU is not financially healthy enough and could expect problems in meeting its short term obligations.
TWOU has a Current ratio of 0.91. This is in the lower half of the industry: TWOU underperforms 71.88% of its industry peers.
A Quick Ratio of 0.91 indicates that TWOU may have some problems paying its short term obligations.
The Quick ratio of TWOU (0.91) is worse than 68.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.91 |
3. Growth
3.1 Past
TWOU shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -250.00%.
TWOU shows a decrease in Revenue. In the last year, the revenue decreased by -4.47%.
Measured over the past years, TWOU shows a quite strong growth in Revenue. The Revenue has been growing by 18.10% on average per year.
EPS 1Y (TTM)-250%
EPS 3YN/A
EPS 5YN/A
EPS growth Q2Q-120%
Revenue 1Y (TTM)-4.47%
Revenue growth 3Y6.89%
Revenue growth 5Y18.1%
Revenue growth Q2Q-16.82%
3.2 Future
The Earnings Per Share is expected to grow by 4.54% on average over the next years.
TWOU is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.72% yearly.
EPS Next Y-574.1%
EPS Next 2Y-33.01%
EPS Next 3Y4.54%
EPS Next 5YN/A
Revenue Next Year-16.82%
Revenue Next 2Y-4.93%
Revenue Next 3Y-0.72%
Revenue Next 5YN/A
3.3 Evolution
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings Ratio is negative for TWOU. In the last year negative earnings were reported.
A Price/Forward Earnings ratio of 15.25 indicates a correct valuation of TWOU.
Based on the Price/Forward Earnings ratio, TWOU is valued a bit cheaper than the industry average as 78.13% of the companies are valued more expensively.
TWOU is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.47, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 15.25 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TWOU is valued cheaply inside the industry as 81.25% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 7.29 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-33.01%
EPS Next 3Y4.54%
5. Dividend
5.1 Amount
No dividends for TWOU!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
2U INC
NASDAQ:TWOU (5/16/2024, 7:22:35 PM)
After market: 0.3487 +0.01 (+1.93%)0.3421
-0.01 (-1.58%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap28.61M
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 15.25 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -22.21% | ||
| ROE | -188.75% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 0.01% | ||
| PM (TTM) | N/A | ||
| GM | 54.64% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.63
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 5.33 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.91 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-250%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y-574.1%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-4.47%
Revenue growth 3Y6.89%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y