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2U Inc (TWOU) Stock Fundamental Analysis

USA - Nasdaq - NASDAQ:TWOU - US90214J2006 - Common Stock

1.58 USD
-0.86 (-35.25%)
Last: 8/6/2024, 8:00:03 PM
1.5007 USD
-0.08 (-5.02%)
After Hours: 8/6/2024, 8:00:03 PM
Fundamental Rating

2

Taking everything into account, TWOU scores 2 out of 10 in our fundamental rating. TWOU was compared to 76 industry peers in the Diversified Consumer Services industry. TWOU may be in some trouble as it scores bad on both profitability and health. TWOU has a expensive valuation and it also scores bad on growth.


Dividend Valuation Growth Profitability Health

2

1. Profitability

1.1 Basic Checks

  • In the past year TWOU was profitable.
  • In the past year TWOU had a positive cash flow from operations.
  • In the past 5 years TWOU always reported negative net income.
  • The reported operating cash flow has been mixed in the past 5 years: TWOU reported negative operating cash flow in multiple years.
TWOU Yearly Net Income VS EBIT VS OCF VS FCFTWOU Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 -100M -200M -300M

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 67.69% of its industry peers.
  • TWOU has a Return On Equity of -188.75%. This is in the lower half of the industry: TWOU underperforms 78.46% of its industry peers.
  • The Return On Invested Capital of TWOU (0.01%) is comparable to the rest of the industry.
Industry RankSector 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
TWOU Yearly ROA, ROE, ROICTWOU Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 0 -50 -100

1.3 Margins

  • With a Operating Margin value of 0.01%, TWOU perfoms like the industry average, outperforming 52.31% of the companies in the same industry.
  • Looking at the Gross Margin, with a value of 54.64%, TWOU is in the better half of the industry, outperforming 63.08% of the companies in the same industry.
  • TWOU's Gross Margin has declined in the last couple of years.
Industry RankSector 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%
TWOU Yearly Profit, Operating, Gross MarginsTWOU Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 0 20 -20 40 -40 60

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0

2. Health

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TWOU is destroying value.
  • Compared to 1 year ago, TWOU has less shares outstanding
  • TWOU has a worse debt/assets ratio than last year.
TWOU Yearly Shares OutstandingTWOU Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 20M 40M 60M
TWOU Yearly Total Debt VS Total AssetsTWOU Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 500M 1B 1.5B 2B

2.2 Solvency

  • TWOU has an Altman-Z score of -0.90. This is a bad value and indicates that TWOU is not financially healthy and even has some risk of bankruptcy.
  • TWOU has a worse Altman-Z score (-0.90) than 70.77% of its industry peers.
  • 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 84.62% of its industry peers.
Industry RankSector Rank
Debt/Equity 5.33
Debt/FCF N/A
Altman-Z -0.9
ROIC/WACC0
WACC5.35%
TWOU Yearly LT Debt VS Equity VS FCFTWOU Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 200M 400M 600M 800M

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.
  • Looking at the Current ratio, with a value of 0.91, TWOU is doing worse than 66.15% of the companies in the same industry.
  • TWOU has a Quick 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's Quick ratio of 0.91 is on the low side compared to the rest of the industry. TWOU is outperformed by 66.15% of its industry peers.
Industry RankSector Rank
Current Ratio 0.91
Quick Ratio 0.91
TWOU Yearly Current Assets VS Current LiabilitesTWOU Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M

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3

3. Growth

3.1 Past

  • TWOU shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 37450.00%, which is quite impressive.
  • The Revenue has decreased by -4.47% in the past year.
  • TWOU shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 18.10% yearly.
EPS 1Y (TTM)37450%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-6500%
Revenue 1Y (TTM)-4.47%
Revenue growth 3Y6.89%
Revenue growth 5Y18.1%
Sales Q2Q%-16.82%

3.2 Future

  • Based on estimates for the next years, TWOU will show a very negative growth in Earnings Per Share. The EPS will decrease by -26.83% on average per year.
  • TWOU is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.04% yearly.
EPS Next Y-55.1%
EPS Next 2Y-42.67%
EPS Next 3Y-26.83%
EPS Next 5YN/A
Revenue Next Year-16.63%
Revenue Next 2Y-4.79%
Revenue Next 3Y-0.04%
Revenue Next 5YN/A

3.3 Evolution

  • The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
TWOU Yearly Revenue VS EstimatesTWOU Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 200M 400M 600M 800M
TWOU Yearly EPS VS EstimatesTWOU Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0 10 -10 -20 -30

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3

4. Valuation

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 0.21, the valuation of TWOU can be described as very cheap.
  • Based on the Price/Earnings ratio, TWOU is valued cheaply inside the industry as 98.46% of the companies are valued more expensively.
  • Compared to an average S&P500 Price/Earnings ratio of 27.38, TWOU is valued rather cheaply.
  • The Forward Price/Earnings Ratio is negative for TWOU. No positive earnings are expected for the next year.
Industry RankSector Rank
PE 0.21
Fwd PE N/A
TWOU Price Earnings VS Forward Price EarningsTWOU Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 0 10 20

4.2 Price Multiples

  • 83.08% of the companies in the same industry are more expensive than TWOU, based on the Enterprise Value to EBITDA ratio.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 7.07
TWOU Per share dataTWOU EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 200 -200

4.3 Compensation for Growth

  • A cheap valuation may be justified as TWOU's earnings are expected to decrease with -26.83% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-42.67%
EPS Next 3Y-26.83%

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0

5. Dividend

5.1 Amount

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

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2U Inc

NASDAQ:TWOU (8/6/2024, 8:00:03 PM)

After market: 1.5007 -0.08 (-5.02%)

1.58

-0.86 (-35.25%)

Chartmill FA Rating
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)07-31
Earnings (Next)11-07
Inst Owners223.4%
Inst Owner Change0%
Ins Owners315.07%
Ins Owner Change0%
Market Cap4.44M
Revenue(TTM)905.84M
Net Income(TTM)-318.20M
Analysts47.5
Price Target21.42 (1255.7%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.46%
Min EPS beat(2)-26.16%
Max EPS beat(2)37.09%
EPS beat(4)1
Avg EPS beat(4)-34.9%
Min EPS beat(4)-139.54%
Max EPS beat(4)37.09%
EPS beat(8)3
Avg EPS beat(8)-26.22%
EPS beat(12)7
Avg EPS beat(12)-10.33%
EPS beat(16)11
Avg EPS beat(16)-1.06%
Revenue beat(2)0
Avg Revenue beat(2)-5.89%
Min Revenue beat(2)-10.94%
Max Revenue beat(2)-0.85%
Revenue beat(4)1
Avg Revenue beat(4)-4.57%
Min Revenue beat(4)-10.94%
Max Revenue beat(4)0.52%
Revenue beat(8)1
Avg Revenue beat(8)-3.85%
Revenue beat(12)1
Avg Revenue beat(12)-3.05%
Revenue beat(16)5
Avg Revenue beat(16)-1.51%
PT rev (1m)0%
PT rev (3m)2300%
EPS NQ rev (1m)12.18%
EPS NQ rev (3m)-4707.57%
EPS NY rev (1m)33523.9%
EPS NY rev (3m)2746.3%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.29%
Revenue NY rev (1m)0.2%
Revenue NY rev (3m)0.23%
Valuation
Industry RankSector Rank
PE 0.21
Fwd PE N/A
P/S 0
P/FCF N/A
P/OCF 0.11
P/B 0.03
P/tB N/A
EV/EBITDA 7.07
EPS(TTM)7.47
EY472.78%
EPS(NY)-0.5
Fwd EYN/A
FCF(TTM)-1.49
FCFYN/A
OCF(TTM)14.71
OCFY931.08%
SpS322.36
BVpS59.99
TBVpS-298.4
PEG (NY)N/A
PEG (5Y)N/A
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA -22.21%
ROE -188.75%
ROCE 0.01%
ROIC 0.01%
ROICexc 0.01%
ROICexgc 0.64%
OM 0.01%
PM (TTM) N/A
GM 54.64%
FCFM N/A
ROA(3y)-16.26%
ROA(5y)-16.52%
ROE(3y)-77.58%
ROE(5y)-57.76%
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
ROICexgc growth 3YN/A
ROICexgc 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 3Y2.9%
GM growth 5Y-2.84%
F-Score5
Asset Turnover0.63
Health
Industry RankSector Rank
Debt/Equity 5.33
Debt/FCF N/A
Debt/EBITDA 8.16
Cap/Depr 41.4%
Cap/Sales 5.03%
Interest Coverage 250
Cash Conversion 37.54%
Profit Quality N/A
Current Ratio 0.91
Quick Ratio 0.91
Altman-Z -0.9
F-Score5
WACC5.35%
ROIC/WACC0
Cap/Depr(3y)55.38%
Cap/Depr(5y)70.03%
Cap/Sales(3y)6.81%
Cap/Sales(5y)8.6%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)37450%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-6500%
EPS Next Y-55.1%
EPS Next 2Y-42.67%
EPS Next 3Y-26.83%
EPS Next 5YN/A
Revenue 1Y (TTM)-4.47%
Revenue growth 3Y6.89%
Revenue growth 5Y18.1%
Sales Q2Q%-16.82%
Revenue Next Year-16.63%
Revenue Next 2Y-4.79%
Revenue Next 3Y-0.04%
Revenue Next 5YN/A
EBIT growth 1Y100.26%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year35.34%
EBIT Next 3Y18.37%
EBIT Next 5YN/A
FCF growth 1Y95.82%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y260.41%
OCF growth 3YN/A
OCF growth 5YN/A

2U Inc / TWOU FAQ

Can you provide the ChartMill fundamental rating for 2U Inc?

ChartMill assigns a fundamental rating of 2 / 10 to TWOU.


What is the valuation status of 2U Inc (TWOU) stock?

ChartMill assigns a valuation rating of 3 / 10 to 2U Inc (TWOU). This can be considered as Overvalued.


Can you provide the profitability details for 2U Inc?

2U Inc (TWOU) has a profitability rating of 2 / 10.


How financially healthy is 2U Inc?

The financial health rating of 2U Inc (TWOU) is 1 / 10.