Reviewing XChange TEC.INC (NASDAQ:XHG) and GoHealth (NASDAQ:GOCO)

XChange TEC.INC (NASDAQ:XHG) and GoHealth (NASDAQ:GOCO) are both small-cap business services companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, valuation, profitability, institutional ownership, dividends and analyst recommendations.

Insider and Institutional Ownership

24.2% of GoHealth shares are owned by institutional investors. 0.6% of XChange TEC.INC shares are owned by insiders. Comparatively, 35.0% of GoHealth shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility and Risk

XChange TEC.INC has a beta of -0.76, indicating that its stock price is 176% less volatile than the S&P 500. Comparatively, GoHealth has a beta of 1.67, indicating that its stock price is 67% more volatile than the S&P 500.

Profitability

This table compares XChange TEC.INC and GoHealth’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
XChange TEC.INC	N/A	N/A	N/A
GoHealth	-4.32%	-17.17%	-4.58%

Analyst Ratings

This is a summary of recent ratings and recommmendations for XChange TEC.INC and GoHealth, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
XChange TEC.INC	0	0	0	0	0.00
GoHealth	0	1	0	0	2.00

GoHealth has a consensus target price of $13.00, suggesting a potential downside of 26.60%. Given GoHealth’s stronger consensus rating and higher probable upside, analysts clearly believe GoHealth is more favorable than XChange TEC.INC.

Earnings and Valuation

This table compares XChange TEC.INC and GoHealth”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
XChange TEC.INC	$41.09 million	0.01	-$32.32 million	N/A	N/A
GoHealth	$734.67 million	0.55	-$63.26 million	($3.50)	-5.06

XChange TEC.INC has higher earnings, but lower revenue than GoHealth.

Summary

GoHealth beats XChange TEC.INC on 7 of the 11 factors compared between the two stocks.

About XChange TEC.INC

XChange TEC.INC engages in the professional insurance agency business in the People’s Republic of China. The company provides a various insurance products underwritten by insurance companies, including state-owned property and casualty insurance companies, as well as various regional property and casualty insurance companies. It also offers automobile, life, health, group accident, and other property related insurances primarily to individual end consumers. In addition, the company operates a SaaS platform to offer comprehensive services to online customers. It sells insurance primarily through a network of external referral sources that include external registered sales representatives and strategic channel partners, as well as through the in-house sales force. The company was formerly known as FLJ Group Limited and changed its name to XChange TEC.INC in May 2024. XChange TEC.INC was founded in 2012 and is based in Shanghai, the People’s Republic of China.

About GoHealth

GoHealth, Inc. operates as a health insurance marketplace and Medicare-focused digital health company in the United States. The company operates a technology platform that leverages machine-learning algorithms of insurance behavioral data to optimize the process for helping individuals find the health insurance plan for their specific needs. It provides Medicare plans, including Medicare Advantage, Medicare Supplement and Prescription Drug, and Medicare Special Needs Plans. The company also offers partner marketing services. It sells its products through carriers and online platform, as well as independent and external agencies. The company was founded in 2001 and is headquartered in Chicago, Illinois.