TAL Education vs Gaotu

Gaotu and TAL Education are presented together to compare their business models, financial performance, and market context, with plain language and neutral framing. The content discusses how each company operates, their revenue sources, strategic aims, and the conditions that shape their industry. Educational content, not financial advice.

Gaotu and TAL Education are presented together to compare their business models, financial performance, and market context, with plain language and neutral framing. The content discusses how each comp...

Comparison Snapshot

Key Financial Metrics

TAL

Metric

GOTU

$6.52B

Market Cap

$561.56M

34.36%

Potential Profit

92.37%

Buy

Analyst Rating

Buy

Investment Analysis

TAL Education

TAL

Pros

TAL Education has demonstrated strong recent revenue growth, with second-quarter fiscal 2026 sales up 39% year on year.
The company operates a diversified portfolio of enrichment learning, academic tutoring, and technology-driven content solutions in China.
Analysts generally rate TAL as a buy, with a consensus price target suggesting moderate upside potential.

Considerations

TAL trades at a high valuation multiple, with a price-to-earnings ratio significantly above industry averages.
The company is exposed to regulatory risks in China's education sector, which has seen increased government scrutiny in recent years.
TAL's business is concentrated in China, making it vulnerable to local economic and policy shifts.

Gaotu

GOTU

Pros

Gaotu Techedu operates a scalable online education model with a large-class format, enabling rapid expansion of its student base.
The company offers a broad range of learning services, including academic, non-academic, and adult education, diversifying its revenue streams.
Gaotu's price-to-sales ratio is relatively moderate compared to peers, suggesting a more balanced valuation.

Considerations

Gaotu's quick ratio is below 1, indicating potential short-term liquidity pressure.
The company is entirely focused on the Chinese market, exposing it to regulatory and macroeconomic risks in that region.
Gaotu's current ratio is only slightly above 1, suggesting limited cushion against unexpected financial obligations.

About The Companies

TAL Education (TAL)

TAL Education Group (TAL) is a China-based provider of after-school tutoring and educational services, historically focused on K–12 supplementary learning delivered through a mix of online platforms and offline centres. With a market capitalisation of about $7.63 billion, TAL has been reshaping its business after significant regulatory change in China’s private education sector; it is pursuing digital products, AI-driven tools and broader learning services as part of that transition. Investors should know TAL’s revenue and profitability can be volatile because of policy, competitive shifts and changing enrolment trends. Opportunities include scaling digital delivery and expanded course offerings, while risks include regulatory intervention, execution challenges and macroeconomic factors. This is general educational information, not personal financial advice — suitability depends on individual circumstances and investors should review the company’s latest filings and consider seeking regulated financial advice. Past performance is not a reliable indicator of future results.

Gaotu (GOTU)

Gaotu Techedu Inc. is a technology-focused education company that aims to facilitate lifelong learning. It uses artificial intelligence (AI) to create and deliver a range of educational services and products for learners of all ages, from pre-schoolers to adults. The company's business is split into two main areas. The first is learning services, which includes traditional tutoring, non-academic courses, and professional development for adults. The second is educational content and digital products, where it develops and sells books and smart learning tools like AI-powered reading apps and translation pens. By integrating technology into its offerings, Gaotu seeks to provide modern, accessible learning solutions. As with any investment, it's important to remember that a company's value can go down as well as up, and past success is not a guide to future performance.

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Which Baskets Do They Appear In?

Education in the Spotlight

This carefully selected group of stocks features companies that could benefit from McGraw Hill's upcoming $4.2 billion IPO. Our professional analysts have identified these educational publishers, digital platforms, and service providers as potential beneficiaries of renewed investor interest in the education sector.

Published: July 15, 2025

Explore Basket

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Invest in companies addressing the IMF's call for enhanced workforce participation and productivity. These carefully selected stocks represent businesses providing the training, technology, and services needed to upskill workers and integrate underutilized talent in our changing economy.

Published: July 2, 2025

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Published: June 18, 2025

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Tap into the growing market for lifelong learning and professional development. These carefully selected companies are at the forefront of educational innovation, from digital platforms to specialized training services. Our analysts have identified the leaders in this expanding sector.

Published: June 17, 2025

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Comparison Snapshot