DAO - Results Beat Validates My Positive View Of Youdao

2024-05-27 15:05:18 ET

Summary

• Youdao's Q1 2024 financial performance surprised the market in a favorable manner considering its higher-than-expected revenue and the achievement of positive normalized earnings.
• The growth in DAO's AI-related subscription revenue could be a re-rating catalyst for the stock.
• I continue to rate Youdao as a Buy, taking into account the favorable takeaways from DAO's latest quarterly results.

Elevator Pitch

Youdao, Inc. ( DAO ) stock is still rated as a Buy.

Earlier, I outlined my expectations regarding Youdao's financial outlook for full-year FY 2024 in my March 12, 2024 write-up . With the current article, I highlight how DAO's above-expected Q1 2024 results have validated my favorable opinion of the company's financial prospects....

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