APEI or BFAM: Which Is the Better Value Stock Right Now?
Investors with an interest in Schools stocks have likely encountered both American Public Education (APEI) and Bright Horizons Family Solutions (BFAM). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
American Public Education and Bright Horizons Family Solutions are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that APEI is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
APEI currently has a forward P/E ratio of 20.91, while BFAM has a forward P/E of 34.43. We also note that APEI has a PEG ratio of 1.39. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BFAM currently has a PEG ratio of 3.56.
Another notable valuation metric for APEI is its P/B ratio of 0.85. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, BFAM has a P/B of 5.29.
These are just a few of the metrics contributing to APEI's Value grade of A and BFAM's Value grade of D.
APEI has seen stronger estimate revision activity and sports more attractive valuation metrics than BFAM, so it seems like value investors will conclude that APEI is the superior option right now.
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American Public Education, Inc. (APEI) : Free Stock Analysis Report
Bright Horizons Family Solutions Inc. (BFAM) : Free Stock Analysis Report
