How to invest smart in stocks during COVID

Have a look at China Education Resources (CHNUF)

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On November 17, 2020, Yahoo.com published an article by Ed Carson titled “Stock Market Rally At Highs, With Google, JD.com, Moderna Coronavirus Vaccine In Focus; What You Should Do By Monday

In it, Carson states, “The stock market rally is at record highs following positive coronavirus vaccine news…Here are a few stocks to consider. Google parent Alphabet (NASDAQ: GOOGL) and Applied Materials (NASDAQ: AMAT) are holding in buy zones, while Exact Sciences (NASDAQ: EXAS) just formed a three-weeks-tight. Microsoft (NASDAQ:MSFT) has just formed a proper handle in its consolidation. Visa (NYSE: V) is closing to forming a handle after trying to break out.”

“Meanwhile, more coronavirus vaccine news could be on the way. Pfizer (NYSE: PFE) and BioNTech (NASDAQ: BNTX), are likely to release key safety data for their coronavirus vaccine in the coming week after announcing last Monday that it was more than 90% effective. Assuming the vaccine clears that hurdle, an FDA emergency use application would quickly follow.”

“Right now, the stock market rally is hard to interpret. The major indexes look strong, with the Dow Jones and S&P 500 right at highs. The Nasdaq had a bit of a shakeout but is just off all-time highs.”

Carson contemplates, “what do investors do with this market?…One idea is to look for stocks that have done relatively well in the coronavirus pandemic and should keep doing well going forward. Google and Microsoft seem possible candidates, while Applied Materials and other chip-gear names are prospering. Data-center chip makers are struggling, but Apple (NASDAQ: AAPL) chipmakers such as Qualcomm (NASDAQ: QCOM) and Taiwan Semiconductor are faring better.

Many Chinese stocks are doing well, though often they are extended, have volatile charts or have earnings due — with JD.com (NASDAQ: JD) stock qualifying for all three.”

Carson suggested to “[l]ook for stocks with strong relative strength. Give a little slack on recent earnings for “real economy” stocks that took big hits in 2020 from the pandemic. They may see a big recovery in 2021.”

In light of Carson’s article, let us turn to the Ed-Tech sector that has benefitted during the pandemic, and in particular consider China Education Resources Inc. (“CHNUF”). CHNUF is perfectly poised to cater towards the intensified e-learning market demands which have arisen as a direct result of the COVID-19 pandemic. Based in Vancouver, Canada, CHNUF is a publicly-listed ed-tech company (TSX-V – CHN and OTCQB – CHNUF) with leading technology inintelligent system and contents. It provides online/offline learning, training courses, and social media for teachers, students and education professionals; these are all increasingly integral aspects of education in the contemporary era. CHNUF has 2 million kindergarten through twelfth-grade teachers registered through its web portal in China.

CHNUF’s online education platform and services provide a vertically blended learning, teaching, research and management system for a student-teacher-school-parent community. CHNUF’s products and services facilitate a significantly more efficient and enriched virtual educational experience for both teachers and students, most especially during a time when online education has become the backbone of many societies around the world. In combination with the circumstances and demands which have arisen as a result of the COVID-19 pandemic, we believe that China Education Resources’ numerous attributes will provide the Company with great long-term revenue potential.

CHNUF has 47,364,983 common shares outstanding. CHNUF generated US$9,390,402 revenue in 2019. CHNUF made US$978,466 net income in Q2 2020 (earnings per share $0.02).

China Education Resources Inc. (CHNUF) current price is $0.04 per share (P/S Ratio of 0.20, P/E Ratio of 2.0)

In comparison with CHNUF, the ratios of some larger education companies or organizations are as follows: *

1. Chegg, Inc. (CHGG)P/S Ratio of 22P/E Ratio of 5,375
2. New Oriental Education & Technology Group Inc. (EDU)P/S Ratio of 6.8P/E Ratio of 58
3. GSX Techedu Inc. (GSX)P/S Ratio of 84P/E Ratio of 700
4. TAL Education Group (TAL)P/S Ratio of 13P/E Ratio N/A
5. Genius Brands International, Inc. (GNUS)P/S Ratio of 42P/E Ratio N/A
6. Microsoft Corporation (MSFT)P/S Ratio of 11P/E Ratio of 35
7. NVIDIA Corporation (NVDA)P/S Ratio of 27P/E Ratio of 107
8. Zoom Video Communications, Inc. (ZM)P/S Ratio of 232P/E Ratio of 654
9. DocuSign, Inc. (DOCU)P/S Ratio of 40P/E Ratio N/A
10. Slack Technologies, Inc. (WORK)P/S Ratio of 19P/E Ratio N/A

(*Calculations are based on figures from Yahoo Finance as of Sept. 23, 2020)

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