NasdaqGS:TWOU

Stock Analysis Report

Executive Summary

2U, Inc. operates as an education technology company in the United States, Hong Kong, South Africa, and the United Kingdom.


Snowflake Analysis

Adequate balance sheet and overvalued.


Similar Companies

Share Price & News

How has 2U's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: TWOU's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

10.2%

TWOU

-1.4%

US Software

2.4%

US Market


1 Year Return

-69.4%

TWOU

8.6%

US Software

-10.0%

US Market

Return vs Industry: TWOU underperformed the US Software industry which returned 8.6% over the past year.

Return vs Market: TWOU underperformed the US Market which returned -10% over the past year.


Shareholder returns

TWOUIndustryMarket
7 Day10.2%-1.4%2.4%
30 Day-24.6%-7.7%-11.0%
90 Day-12.3%-7.8%-19.4%
1 Year-69.4%-69.4%9.8%8.6%-8.1%-10.0%
3 Year-51.6%-51.6%104.2%95.6%17.3%9.6%
5 Year-18.2%-18.2%169.6%150.6%36.1%21.1%

Price Volatility Vs. Market

How volatile is 2U's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is 2U undervalued compared to its fair value and its price relative to the market?

1.83x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate TWOU's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate TWOU's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: TWOU is unprofitable, so we can't compare its PE Ratio to the Software industry average.

PE vs Market: TWOU is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate TWOU's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: TWOU is good value based on its PB Ratio (1.8x) compared to the US Software industry average (4.4x).


Next Steps

Future Growth

How is 2U forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

9.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TWOU is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: TWOU is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: TWOU is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: TWOU's revenue (15.6% per year) is forecast to grow faster than the US market (7% per year).

High Growth Revenue: TWOU's revenue (15.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TWOU is forecast to be unprofitable in 3 years.


Next Steps

Past Performance

How has 2U performed over the past 5 years?

-44.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TWOU is currently unprofitable.

Growing Profit Margin: TWOU is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: TWOU is unprofitable, and losses have increased over the past 5 years at a rate of -44.5% per year.

Accelerating Growth: Unable to compare TWOU's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: TWOU is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (18.4%).


Return on Equity

High ROE: TWOU has a negative Return on Equity (-33.07%), as it is currently unprofitable.


Next Steps

Financial Health

How is 2U's financial position?


Financial Position Analysis

Short Term Liabilities: TWOU's short term assets ($260.9M) exceed its short term liabilities ($156.0M).

Long Term Liabilities: TWOU's short term assets ($260.9M) do not cover its long term liabilities ($319.6M).


Debt to Equity History and Analysis

Debt Level: TWOU's debt to equity ratio (34.7%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if TWOU's debt to equity ratio has reduced over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: TWOU has sufficient cash runway for more than a year based on its current free cash flow.

Forecast Cash Runway: TWOU has sufficient cash runway for 2.1 years if free cash flow continues to reduce at historical rates of -34% each year.


Next Steps

Dividend

What is 2U's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate TWOU's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate TWOU's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if TWOU's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if TWOU's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of TWOU's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.0yrs

Average management tenure


CEO

Chip Paucek (49yo)

8.25s

Tenure

US$16,923,643

Compensation

Mr. Christopher J. Paucek, also known as Chip, serves as a Member of Advisory Board at Exceed Capital Partners. He is a Co-Founder of 2U, Inc. and has been its Chief Executive Officer and Director since Ja ...


CEO Compensation Analysis

Compensation vs Market: Chip's total compensation ($USD16.92M) is above average for companies of similar size in the US market ($USD4.67M).

Compensation vs Earnings: Chip's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Christopher Paucek
Co-Founder8.25yrsUS$16.92m0.71% $9.3m
Mark Chernis
Chief Operating Officer1.92yrsUS$3.82m0.12% $1.6m
James Kenigsberg
Chief Technology Officer9.75yrsUS$2.08m0.18% $2.4m
Harsha Mokkarala
Chief Revenue Officer2yrsUS$2.02m0.074% $966.7k
Paul Lalljie
Chief Financial Officer0.50yrno datano data
John Ellis
Senior VP1.92yrsno data0.0018% $23.6k
Ed Goodwin
Vice President of Investor Relationsno datano datano data
Denis Ryan
Executive Vice President of Compliance & Regulatory Affairsno datano datano data
Jennifer Ogden-Reese
Chief Marketing Officer0.42yrno datano data
Rani Hammond
Chief People Officer2.5yrsno datano data

2.0yrs

Average Tenure

47.5yo

Average Age

Experienced Management: TWOU's management team is not considered experienced ( 2 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Christopher Paucek
Co-Founder8.25yrsUS$16.92m0.71% $9.3m
Paul Maeder
Chairman7.42yrsUS$154.96k0.14% $1.8m
Timothy Haley
Independent Director10.17yrsUS$144.96k0.10% $1.3m
Robert Stavis
Independent Director9yrsUS$154.96k0.30% $3.9m
John Larson
Independent Director10.83yrsUS$144.96k0.32% $4.2m
Jeremy Johnson
Member of Advisory Boardno datano datano data
Adrian Fenty
Member of Advisory Board6.17yrsno datano data
Joshua Jarrett
Member of Advisory Board6.17yrsno datano data
Binta Brown
Member of Advisory Board6.17yrsno datano data
Haley Demaria
Member of Advisory Board6.17yrsno datano data

7.4yrs

Average Tenure

63yo

Average Age

Experienced Board: TWOU's board of directors are considered experienced (7.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 10%.


Top Shareholders

Company Information

2U, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: 2U, Inc.
  • Ticker: TWOU
  • Exchange: NasdaqGS
  • Founded: 2008
  • Industry: Application Software
  • Sector: Software
  • Market Cap: US$1.301b
  • Shares outstanding: 63.63m
  • Website: https://2u.com

Number of Employees


Location

  • 2U, Inc.
  • 7900 Harkins Road
  • Lanham
  • Maryland
  • 20706
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TWOUNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMar 2014
2U1DB (Deutsche Boerse AG)YesCommon StockDEEURMar 2014
0LHPLSE (London Stock Exchange)YesCommon StockGBUSDMar 2014
2U1BRSE (Berne Stock Exchange)YesCommon StockCHCHFMar 2014

Biography

2U, Inc. operates as an education technology company in the United States, Hong Kong, South Africa, and the United Kingdom. It operates in two segments, Graduate Program Segment and Short Course Segment. The Graduate Program Segment targets students seeking a full graduate degree. The Short Course Segment targets working professionals seeking career advancement through skills attainment. The company builds, delivers, and supports online graduate programs and certificates for working adults through its 2U Operating System, a platform that provides front-end and back-end cloud-based SaaS technology and technology-enabled services to university clients. The company was formerly known as 2Tor Inc. and changed its name to 2U, Inc. in October 2012. 2U, Inc. was founded in 2008 and is headquartered in Lanham, Maryland. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/08 06:52
End of Day Share Price2020/04/07 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.