Sunlands Online Education Group (STG)
NYSE:STG
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Sunlands Online Education Group
(NYSE:STG)
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Rating:71Outperform
Price Target:
$4.00
▼(-36.00% Downside)
Action:Upgraded
Date:06/03/26
The score is led by solid financial performance (strong profitability and improved leverage/equity profile) and very favorable valuation (extremely low P/E). These positives are partially offset by earnings-call indications of ongoing top-line pressure (weak Q2 guidance and declining deferred revenue) and only moderate technicals with a still-weak longer-term trend.
Positive Factors
Sustained Profitability
Twenty consecutive profitable quarters and a 17.4% net margin show a durable ability to convert revenue into earnings. Persistent profitability provides internal funding for R&D and strategic initiatives, demonstrates resilient unit economics and supports capital returns even amid top-line pressure.
Negative Factors
Multi-year Revenue Decline
Sustained revenue contraction across multiple years undermines scalability and compresses revenue base. Continued top-line erosion reduces operating leverage, limits absolute growth potential and increases reliance on cost cuts or one-off measures to preserve margins over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Sustained Profitability
Twenty consecutive profitable quarters and a 17.4% net margin show a durable ability to convert revenue into earnings. Persistent profitability provides internal funding for R&D and strategic initiatives, demonstrates resilient unit economics and supports capital returns even amid top-line pressure.
Read all positive factors
Sunlands Online Education Group (STG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$45.40M
Dividend YieldN/A
Average Volume (3M)7.97K
Price to Earnings (P/E)0.8
Beta (1Y)0.84
Revenue Growth2.50%
EPS Growth23.59%
CountryUS
Employees2,071
SectorConsumer Defensive
Sector Strength42
IndustryEducation & Training Services
Share Statistics
EPS (TTM)27.06
Shares Outstanding5,076,094
10 Day Avg. Volume6,475
30 Day Avg. Volume7,968
Financial Highlights & Ratios
PEG Ratio0.28
Price to Book (P/B)0.59
Price to Sales (P/S)0.28
P/FCF Ratio3.91
Enterprise Value/Market Cap3.12
Enterprise Value/Revenue0.07
Enterprise Value/Gross Profit0.08
Enterprise Value/Ebitda0.33
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Sunlands Online Education Group Business Overview & Revenue Model
Company Description
Sunlands Technology Group, through its subsidiaries, provides online education services in the People's Republic of China. It offers various degree- and diploma-oriented post-secondary courses, including preparation courses for the self-taught hig...
How the Company Makes Money
Sunlands primarily makes money by charging learners tuition and service fees for access to its online education offerings. Key revenue streams include: (1) course fees collected from students enrolled in its online programs (typically adult/profes...
Sunlands Online Education Group Earnings Call Summary
Earnings Call Date:May 26, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 13, 2026
Earnings Call Sentiment Neutral
The call balanced notable operational and financial positives — sustained profitability (20th consecutive profitable quarter), margin expansion, significant reductions in sales & marketing spend and continued strategic investment in AI — against persistent top-line challenges, including a 9.6% revenue decline in Q1 and a conservative Q2 revenue outlook of -20.2% to -23.9% YoY. While the company is demonstrating disciplined cost management and building long-term capabilities, near-term revenue headwinds and declining deferred revenue temper the tone.Positive Updates
Continued Profitability and Strong Net Income Margin
Net income of RMB 76.8 million in Q1 2026 (up from RMB 75.2 million YoY, ≈+2.1%) marking the company's 20th consecutive profitable quarter; net income margin expanded to 17.4%.
Negative Updates
Top-Line Decline
Net revenues decreased 9.6% year-over-year to RMB 440.7 million (from RMB 487.6 million), reflecting ongoing structural softness and stricter customer acquisition standards.
Read all updates
Q1-2026 Updates
Positive
Negative
Continued Profitability and Strong Net Income Margin
Net income of RMB 76.8 million in Q1 2026 (up from RMB 75.2 million YoY, ≈+2.1%) marking the company's 20th consecutive profitable quarter; net income margin expanded to 17.4%.
Read all positive updates
Company Guidance
Guidance: Sunlands expects second-quarter 2026 net revenues of RMB 410 million to RMB 430 million, implying a year-over-year decline of 20.2% to 23.9%; management says this outlook is based on current market dynamics and preliminary assessment of macro conditions and learner demand and is subject to substantial uncertainty. For context, in Q1 2026 the company reported net revenues of RMB 440.7 million (down 9.6% YoY), net income of RMB 76.8 million with a net income margin of 17.4%, gross profit of RMB 381.1 million and gross margin of 86.5%; cost of revenues was RMB 59.5 million (down 17.7% YoY), total operating expenses were RMB 284.3 million (down 16.7% YoY) including selling expenses of RMB 241.9 million (down 19.5% YoY), product development of RMB 6.6 million (up 5.6% YoY), cash and equivalents of RMB 547.2 million, short-term investments of RMB 236.0 million, and deferred revenue of RMB 500.5 million.Sunlands Online Education Group Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
78
Positive
Cash Flow
64
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.02B | 1.99B | 2.16B | 2.32B | 2.51B |
| Gross Profit | 1.76B | 1.67B | 1.89B | 1.97B | 2.13B |
| EBITDA | 459.10M | 391.65M | 714.39M | 663.63M | 246.48M |
| Net Income | 365.63M | 342.08M | 640.83M | 643.96M | 219.06M |
Balance Sheet | |||||
| Total Assets | 2.05B | 2.12B | 2.12B | 2.28B | 2.59B |
| Cash, Cash Equivalents and Short-Term Investments | 813.22M | 783.26M | 905.88M | 824.18M | 810.87M |
| Total Debt | 138.76M | 186.90M | 308.61M | 515.88M | 639.07M |
| Total Liabilities | 1.10B | 1.52B | 1.84B | 2.66B | 3.61B |
| Stockholders Equity | 946.16M | 601.35M | 277.04M | -374.49M | -1.01B |
Cash Flow | |||||
| Free Cash Flow | 142.60M | 195.11M | 134.44M | 40.43M | -389.79M |
| Operating Cash Flow | 142.81M | 195.52M | 140.80M | 62.65M | -373.25M |
| Investing Cash Flow | -12.39M | -358.86M | -71.82M | 659.04M | 342.68M |
| Financing Cash Flow | -46.41M | -112.73M | -74.66M | -465.33M | -38.90M |
Sunlands Online Education Group Technical Analysis
Negative
6.25
Price Trends
3.41
Negative
4.11
Negative
5.61
Negative
Market Momentum
0.10
Negative
49.61
Neutral
25.61
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STG, the sentiment is Negative. The current price of 6.25 is above the 20-day moving average (MA) of 3.32, above the 50-day MA of 3.41, and above the 200-day MA of 5.61, indicating a neutral trend. The MACD of 0.10 indicates Negative momentum. The RSI at 49.61 is Neutral, neither overbought nor oversold. The STOCH value of 25.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STG.
Sunlands Online Education Group Risk Analysis
Sunlands Online Education Group disclosed 87 risk factors in its most recent earnings report. Sunlands Online Education Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
The Group is subject to the uncertainty to continue to achieve profitability in the future. Q4, 2023
2.
If the Group fails to manage its business growth effectively, the success of the Group's business model will be compromised. Q4, 2023
3.
The Group may not be able to timely improve or expand course and educational content offerings in a cost-effective manner to make them appealing to existing and prospective students, or at all. Q4, 2023
Sunlands Online Education Group Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $82.80M | 1.16 | 11.71% | 3.93% | -12.43% | -1.57% | |
71 Outperform | $45.40M | 0.84 | 40.07% | ― | 2.50% | 23.59% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
55 Neutral | $137.71M | -1.64 | -62.94% | ― | -43.54% | 90.44% | |
55 Neutral | $3.80M | 9.54 | 14.42% | ― | ― | ― | |
54 Neutral | $26.97M | -1.18 | -45.82% | ― | -43.76% | 36.62% | |
51 Neutral | $64.57M | -0.45 | -709.20% | ― | -3.45% | -9.46% |
* Consumer Defensive Sector Average
STG
Sunlands Online Education Group
3.41
-2.52
-42.54%
CHGG
Chegg
1.26
-0.37
-22.70%
VSA
VisionSystems AI
6.45
-508.55
-98.75%
SKIL
Skillsoft
7.14
-10.76
-60.11%
IH
iHuman
1.60
-0.64
-28.51%
YQ
17 Education & Technology Group
2.35
0.30
14.63%
Sunlands Online Education Group Corporate Events
Sunlands Technology Group Launches US$50 Million Share Buyback Program
May 29, 2026
Sunlands Technology Group, a major provider in China’s adult online education and personal interest learning segments, offers live-streamed degree, certification and skills courses across PC and mobile platforms. Its proprietary Learning Out...
Sunlands Technology Group Extends Profit Streak but Warns of Revenue Drop in Q2 2026
May 26, 2026
Sunlands Technology Group reported unaudited results for the quarter ended March 31, 2026, showing net revenues down 9.6% year on year to RMB440.7 million and gross billings down more sharply, while net income inched up to RMB76.8 million and marg...
Sunlands Technology Group Files 2025 Form 20-F With U.S. SEC
Apr 24, 2026
Sunlands Technology Group, a major player in China’s adult online education and personal interest learning segments, delivers post-secondary, certification and skills-based courses via interactive live streaming, virtual learning communities...
Sunlands Technology Group Posts Higher 2025 Profit Amid Strategic Shift to Quality Growth
Mar 19, 2026
On March 19, 2026, Sunlands Technology Group reported unaudited results for the fourth quarter and full year ended December 31, 2025, showing modest full-year revenue growth to RMB2.02 billion and higher profitability despite softer top-line momen...
Glossary
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HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.