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Youdao (DAO) has drawn attention after recent trading, with the share price at US$9.28 and returns showing mixed momentum, including a 2.5% gain over the past day and a 22.7% decline over the past month.
See our latest analysis for Youdao.
That recent 1-day share price return of 2.5% comes after a softer patch, with a 30-day share price return of 22.7% decline and a year-to-date share price return of 17.3% decline. The 3-year total shareholder return of 20.2% points to a mixed but still intact longer term story, suggesting short term momentum is fading even as longer term holders remain modestly ahead overall.
If Youdao’s recent swings have you thinking about where else growth might come from in education and AI, it could be a good moment to scan 57 profitable AI stocks that aren’t just burning cash as a starting list of ideas.
With Youdao shares at US$9.28, a 1 year total return decline of 9.6% and a 5 year total return decline of 71.4%, you have to ask: is this an overlooked education and AI play, or is the market already pricing in future growth?
At $9.28, Youdao sits below the most followed narrative fair value of $11.59. This narrative leans on a higher growth and profitability profile supported by AI driven learning tools.
Rapid advancement and integration of proprietary large language models like Confucius are enabling Youdao to deploy personalized and adaptive learning tools (e.g., AI Essay Grading, Mr. P AI Tutor, and AI-driven course recommendations). These tools are driving record-high user retention and positioning the company to capture structural growth in digital, lifelong, and AI-powered education, supporting future revenue growth and margin expansion.
Curious what sits behind that fair value gap? The narrative leans on faster top line expansion, higher margins, and a future earnings multiple that assumes material progress from today. The exact mix of growth, profitability, and discount rate inputs is where the story really gets interesting.
Result: Fair Value of $11.59 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, there are still pressure points to watch, including weaker smart device demand and falling online learning deferred revenue, which could challenge the AI growth story investors are backing.
