ADTALEM GLOBAL EDUCATION INC (NYSE:ATGE) - A Strong Candidate for Affordable Growth Investors

ADTALEM GLOBAL EDUCATION INC (NYSE:ATGE) was identified as an affordable growth stock by our screening process. The company combines solid growth prospects with reasonable valuation metrics, while maintaining decent profitability and financial health. Below, we break down why ATGE stands out in these areas.

Growth Prospects

• Strong Historical Growth: ATGE has demonstrated consistent growth, with revenue increasing by 13.10% over the past year and an average annual growth rate of 9.34% in recent years.
• Earnings Expansion: Earnings per share (EPS) grew by 36.25% in the last year, with a three-year average growth rate of 12.11%.
• Positive Outlook: Analysts expect EPS to grow by 20.13% annually in the coming years, supported by an anticipated revenue increase of 8.09% per year.

Valuation

• Attractive Multiples: ATGE trades at a P/E ratio of 19.23, which is below both the industry average (26.73) and the S&P 500 average (26.32).
• Forward Earnings Discount: The forward P/E of 16.34 suggests the stock is reasonably priced relative to future earnings expectations.
• Enterprise Value to EBITDA: The company is cheaper than 62.86% of its peers based on this metric.

Profitability & Financial Health

• High Margins: ATGE boasts a strong profit margin of 13.34% and an operating margin of 19.55%, outperforming most competitors.
• Solid Return Metrics: The company’s return on invested capital (13.23%) and return on equity (16.21%) are well above industry averages.
• Debt Management: ATGE maintains a healthy debt-to-equity ratio of 0.39 and has reduced its share count over the past five years. However, liquidity ratios (current and quick ratios below 1) indicate some short-term obligations may require monitoring.

For a deeper look at ATGE’s fundamentals, review the full analysis report.

Our Affordable Growth screener lists more stocks with similar characteristics and is updated daily.

Disclaimer

This is not investing advice. The observations here are based on data available at the time of writing. Always conduct your own research before making investment decisions.