PRDO vs. AFYA: Which Stock Is the Better Value Option?
Investors interested in Schools stocks are likely familiar with Perdoceo Education (PRDO) and Afya (AFYA). 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Perdoceo Education is sporting a Zacks Rank of #1 (Strong Buy), while Afya has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that PRDO has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
PRDO currently has a forward P/E ratio of 8.93, while AFYA has a forward P/E of 17.56. We also note that PRDO has a PEG ratio of 0.60. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. AFYA currently has a PEG ratio of 1.
Another notable valuation metric for PRDO is its P/B ratio of 1.46. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, AFYA has a P/B of 2.75.
Based on these metrics and many more, PRDO holds a Value grade of A, while AFYA has a Value grade of C.
PRDO is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that PRDO is likely the superior value option right now.
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Perdoceo Education Corporation (PRDO) : Free Stock Analysis Report
Afya Limited (AFYA) : Free Stock Analysis Report
