DeVry Education Group (ATGE) and Grand Canyon Education (LOPE) Critical Comparison

DeVry Education Group (NYSE: ATGE) and Grand Canyon Education (NASDAQ:LOPE) are both mid-cap consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, analyst recommendations, institutional ownership, dividends, valuation and profitability.

Insider and Institutional Ownership

96.6% of Grand Canyon Education shares are held by institutional investors. 5.3% of DeVry Education Group shares are held by insiders. Comparatively, 3.0% of Grand Canyon Education shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares DeVry Education Group and Grand Canyon Education’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
DeVry Education Group $1.81 billion 1.20 $313.39 million $1.91 18.30
Grand Canyon Education $921.61 million 4.35 $310.30 million $3.62 22.99

DeVry Education Group has higher revenue and earnings than Grand Canyon Education. DeVry Education Group is trading at a lower price-to-earnings ratio than Grand Canyon Education, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

DeVry Education Group has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500. Comparatively, Grand Canyon Education has a beta of 1.4, meaning that its share price is 40% more volatile than the S&P 500.

Profitability

This table compares DeVry Education Group and Grand Canyon Education’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DeVry Education Group 6.76% 10.93% 7.71%
Grand Canyon Education 18.77% 21.77% 15.47%

Dividends

DeVry Education Group pays an annual dividend of $0.18 per share and has a dividend yield of 0.5%. Grand Canyon Education does not pay a dividend. DeVry Education Group pays out 9.4% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current recommendations for DeVry Education Group and Grand Canyon Education, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DeVry Education Group 0 2 2 0 2.50
Grand Canyon Education 0 0 4 0 3.00

DeVry Education Group presently has a consensus price target of $35.67, indicating a potential upside of 2.05%. Grand Canyon Education has a consensus price target of $77.25, indicating a potential downside of 7.18%. Given DeVry Education Group’s higher probable upside, analysts clearly believe DeVry Education Group is more favorable than Grand Canyon Education.

Summary

Grand Canyon Education beats DeVry Education Group on 11 of the 16 factors compared between the two stocks.

About DeVry Education Group

Adtalem Global Education Inc., formerly DeVry Education Group Inc. (DeVry Group) is a global provider of educational services. DeVry Group’s focuses on empowering its students to achieve their educational and career goals. DeVry Group’s institutions offer a range of programs in healthcare, technology, business, accounting, finance and law. The Company operates in three segments: Medical and Healthcare; International and Professional Education, and Business, Technology and Management. Medical and Healthcare includes DeVry Medical International, Chamberlain College of Nursing (Chamberlain) and Carrington College. International and Professional Education consists of DeVry Brasil and Becker Professional Education. Business, Technology and Management consists of DeVry University. As of June 30, 2016, DMI operated three institutions: American University of the Caribbean School of Medicine (AUC), Ross University School of Medicine (RUSM) and Ross University School of Veterinary Medicine.

About Grand Canyon Education

Grand Canyon Education, Inc. is engaged in the provision of postsecondary education. The Company is a regionally accredited university. The Company offers the degrees, including Doctor of Education, Doctor of Business Administration, Doctor of Nursing Practice, Doctor of Philosophy, Education Specialist, Master of Divinity, Master of Arts, Master of Education, Master of Business Administration and Master of Public Administration, Master of Public Health, Master of Science, Bachelor of Arts, Bachelor of Science, and a range of programs for its degrees. It also offers certificate programs, which consist of a series of courses focused on a particular area of study for both the post-baccalaureate and post-graduate students. The Company offers its ground-based programs to students through three 15-week semesters in a calendar year and to online students in courses that generally range from 5 to 16 weeks throughout the calendar year.

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