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Afya (AFYA) Gains As Market Dips: What You Should Know

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Afya (AFYA) closed the most recent trading day at $10.92, moving +0.83% from the previous trading session. This change outpaced the S&P 500's 0.67% loss on the day. Meanwhile, the Dow lost 1.23%, and the Nasdaq, a tech-heavy index, lost 0.05%.

Coming into today, shares of the medical education company had gained 9.06% in the past month. In that same time, the Consumer Discretionary sector gained 6.24%, while the S&P 500 gained 7.79%.

Investors will be hoping for strength from Afya as it approaches its next earnings release, which is expected to be August 22, 2022. The company is expected to report EPS of $0.23, up 666.67% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $119.45 million, up 69.94% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $1.06 per share and revenue of $492.92 million, which would represent changes of +27.71% and +54.68%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Afya. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Afya is currently a Zacks Rank #1 (Strong Buy).

Looking at its valuation, Afya is holding a Forward P/E ratio of 10.22. For comparison, its industry has an average Forward P/E of 15.97, which means Afya is trading at a discount to the group.

Investors should also note that AFYA has a PEG ratio of 0.31 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Schools stocks are, on average, holding a PEG ratio of 0.87 based on yesterday's closing prices.

The Schools industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 39, which puts it in the top 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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