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Youdao Inc (DAO)
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Upturn Advisory Summary
12/04/2025: DAO (1-star) is currently NOT-A-BUY. Pass it for now.
Upturn Star Rating
Not Recommended Performance
These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.
Number of Analysts
8 Analysts rated it
Limited analyst coverage, niche firm, research info may be scarce.
1 Year Target Price $12.94
1 Year Target Price $12.94
| 5 | Strong Buy |
| 1 | Buy |
| 2 | Hold |
| 0 | Sell |
| 0 | Strong Sell |
Analysis of Past Performance
Type Stock | Historic Profit -5.29% | Avg. Invested days 25 | Today’s Advisory PASS |
Upturn Star Rating | Upturn Advisory Performance  2.0 | Stock Returns Performance  1.0 |
| Profits based on simulation | Last Close 12/04/2025 |
Key Highlights
Company Size Small-Cap Stock | Market Capitalization 1.19B USD | Price to earnings Ratio 36.78 | 1Y Target Price 12.94 |
Price to earnings Ratio 36.78 | 1Y Target Price 12.94 | ||
Volume (30-day avg) 8 | Beta 0.24 | 52 Weeks Range 6.30 - 11.82 | Updated Date 11/13/2025 |
52 Weeks Range 6.30 - 11.82 | Updated Date 11/13/2025 | ||
Dividends yield (FY) - | Basic EPS (TTM) 0.27 |
Analyzing Revenue: Products, Geography and Growth
Revenue by Products
Product revenue - Year on Year
Earnings Date
Report Date 2025-11-13 | When Before Market | Estimate 0.57 | Actual 0.0001 |
Profitability
Profit Margin 4.05% | Operating Margin (TTM) 2.03% |
Management Effectiveness
Return on Assets (TTM) 11.19% | Return on Equity (TTM) - |
Valuation
Trailing PE 36.78 | Forward PE - | Enterprise Value 1323593444 | Price to Sales(TTM) 0.21 |
Enterprise Value 1323593444 | Price to Sales(TTM) 0.21 | ||
Enterprise Value to Revenue 1.65 | Enterprise Value to EBITDA 43.95 | Shares Outstanding 31280889 | Shares Floating 26257520 |
Shares Outstanding 31280889 | Shares Floating 26257520 | ||
Percent Insiders 4.35 | Percent Institutions 41.98 |
Upturn AI SWOT
Youdao Inc
Company Overview
History and Background
Youdao Inc. was founded in 2006 as a subsidiary of NetEase, Inc. It began as a search engine and dictionary platform and has since evolved into an intelligent learning company, focusing on technology and content to deliver learning products and services.
Core Business Areas
- Learning Services: Offers a range of online courses, including premium courses, focusing on various subjects and skill development. These are generally offered for a fee. Examples include courses in Math, English, programming and general interest.
- Smart Devices: Designs, develops, and sells smart learning devices such as Youdao Dictionary Pen, Youdao Smart Lamp, and Youdao Listening Pod. These devices integrate AI and other technologies to enhance the learning experience.
- Online Marketing Services: Provides online marketing services to third-party clients through its various platforms.
Leadership and Structure
Youdao Inc. is led by CEO Zhou Feng. The company operates as a subsidiary of NetEase, which holds a controlling stake. The organizational structure supports its various business segments, including research and development, marketing, and sales.
Top Products and Market Share
Key Offerings
- Youdao Dictionary Pen: A smart device that scans and translates text, providing definitions and pronunciations. It has a considerable market share in China's smart dictionary pen market, competing with brands like iFLYTEK. Revenue from smart devices contribute significantly to the company's total revenue. Competitors include iFLYTEK and Baidu.
- Youdao Premium Courses: Online courses covering various subjects, including English, mathematics, and coding. Youdao competes in China's online education market, with other competitors such as TAL Education Group and New Oriental Education & Technology Group. Revenue from these courses constitute a significant portion of revenue.
- Youdao Smart Lamp: A smart lamp with AI capabilities designed for kids study and focused on correcting posture and eye strain. Key competitiors include Baidu and Xiaomi.
Market Dynamics
Industry Overview
The online education market is experiencing significant growth, driven by increased internet penetration, rising disposable incomes, and a growing demand for lifelong learning. The smart learning device market is also growing rapidly, fueled by advancements in AI and IoT technologies.
Positioning
Youdao Inc. is positioned as a leading intelligent learning company, leveraging technology to provide innovative learning products and services. Its competitive advantages include its strong brand recognition, technological expertise, and large user base.
Total Addressable Market (TAM)
The online education market in China is estimated to be worth hundreds of billions of dollars. Youdao is positioned to capture a significant share of this TAM through its diverse product offerings and strong technology platform.
Upturn SWOT Analysis
Strengths
- Strong brand recognition
- Technological expertise in AI and education
- Large user base
- Diversified product offerings
- Backed by NetEase
Weaknesses
- High operating expenses
- Dependence on regulatory environment
- Intense competition
- Loss-making business (though improving)
- Concentration in the Chinese market
Opportunities
- Expansion into new markets
- Development of new learning technologies
- Partnerships with educational institutions
- Increased demand for online education
- Growing smart device market
Threats
- Regulatory changes in China's education sector
- Increased competition from domestic and international players
- Economic slowdown in China
- Changing consumer preferences
- Data privacy concerns
Competitors and Market Share
Key Competitors
- TAL
- EDU
- GOTU
Competitive Landscape
Youdao competes with a mix of established online education companies and emerging technology players. It differentiates itself through its focus on technology and its strong brand recognition. However, it faces intense competition in the crowded online education market.
Growth Trajectory and Initiatives
Historical Growth: Youdao has experienced strong revenue growth over the past few years, driven by its expanding product portfolio and growing user base.
Future Projections: Analysts project continued revenue growth for Youdao, driven by the increasing demand for online education and smart learning devices. Profitability is expected to improve as the company achieves greater economies of scale.
Recent Initiatives: Recent initiatives include the launch of new online courses, the development of innovative smart learning devices, and strategic partnerships with educational institutions.
Summary
Youdao Inc. is an intelligent learning company with solid revenue growth. Although operating expenses continue to cause the business to remain unprofitable, the company is working towards becoming more profitable in the future. It faces intense competition and is highly reliant on regulations in the China's Education sector. Investors should remain cautious about the stock as Youdao navigates challenges and opportunities in the rapidly evolving landscape.
Similar Stocks
Sources and Disclaimers
Data Sources:
- Company SEC Filings
- Analyst Reports
- Industry News
- Company Website
Disclaimers:
The information provided is for informational purposes only and should not be considered financial advice. Investment decisions should be based on your own research and due diligence. Market share data is approximate and may vary depending on the source.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Youdao Inc
Exchange NYSE | Headquaters - | ||
IPO Launch date 2019-10-25 | CEO & Director Mr. Feng Zhou | ||
Sector Consumer Defensive | Industry Education & Training Services | Full time employees 3750 | Website https://www.youdao.com |
Full time employees 3750 | Website https://www.youdao.com | ||
Youdao, Inc., an internet technology company, provides online services in the fields of content, community, communication, and commerce in China. It operates through three segments: Learning Services, Smart Devices, and Online Marketing Services. The learning services mainly include tutoring services and fee-based premium services. The company provides various learning content, applications, and solutions, which cover topics and target people from various age groups for their learning needs through its websites and mobile applications. It also offers online knowledge tools, which include Youdao and other dictionaries and translation tools, as well as AI-based learning tools; STEAM courses through Youdao Premium Courses; adult courses through NetEase Cloud Classroom, such as foreign language, preparing for an exam, and picking up a new skill; and other courses consisting of China University MOOC courses. In addition, the company provides smart devices comprising Youdao Dictionary Pen, and Youdao Listening Pod, and Youdao Smart Learning Pad; education digitalization solutions, such as technologies and solutions licensed to schools or enterprise customers, including Youdao Smart Learning Terminal, Youdao Sports, and Youdao Smart Cloud; and online marketing services consisting of performance-based and brand advertising services. Further, it offers technical support to the variable interest entities (VIEs). The company was founded in 2006 and is headquartered in Hangzhou, China. Youdao, Inc. is a subsidiary of NetEase, Inc.
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