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ATGE vs. LAUR: Which Stock Is the Better Value Option?

Zacks Equity Research
·2 mins read

Investors interested in Schools stocks are likely familiar with Adtalem Global Education (ATGE) and Laureate Education (LAUR). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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.

Adtalem Global Education has a Zacks Rank of #2 (Buy), while Laureate Education has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that ATGE likely has seen a stronger improvement to its earnings outlook than LAUR has recently. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

ATGE currently has a forward P/E ratio of 10.95, while LAUR has a forward P/E of 14.40. We also note that ATGE has a PEG ratio of 0.88. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. LAUR currently has a PEG ratio of 1.20.

Another notable valuation metric for ATGE is its P/B ratio of 1.15. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, LAUR has a P/B of 1.24.

Based on these metrics and many more, ATGE holds a Value grade of A, while LAUR has a Value grade of C.

ATGE sticks out from LAUR in both our Zacks Rank and Style Scores models, so value investors will likely feel that ATGE is the better option right now.


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Adtalem Global Education Inc. (ATGE) : Free Stock Analysis Report
 
Laureate Education Inc. (LAUR) : Free Stock Analysis Report
 
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Zacks Investment Research