ADTALEM GLOBAL EDUCATION INC (NYSE:ATGE) - A Strong Growth Stock Trading at a Reasonable Valuation

ADTALEM GLOBAL EDUCATION INC (NYSE:ATGE) was identified as an affordable growth stock by our stock screener. The company, which provides post-secondary education programs in healthcare and other fields, shows strong growth potential while maintaining reasonable valuation metrics. Its fundamentals suggest a balance between expansion and financial stability, making it worth a closer look for investors seeking growth at a sensible price.

Growth Prospects

• Earnings Growth: ATGE reported a 36.25% year-over-year increase in earnings per share (EPS), well above industry averages.
• Revenue Expansion: Revenue grew 13.10% in the past year, with a steady historical growth rate of 9.34%.
• Future Expectations: Analysts project EPS growth of 20.13% annually, indicating continued momentum.

Valuation

• Price/Earnings Ratio: ATGE trades at a P/E of 18.84, below both the industry average (26.71) and the S&P 500 (27.41).
• Forward P/E: At 15.82, it remains attractively priced compared to peers.
• Price/Free Cash Flow: The stock is cheaper than 83% of its industry peers on this metric.

Profitability & Financial Health

• Strong Margins: Operating margin of 19.55% and profit margin of 13.34% rank in the top 15% of the sector.
• Solid Solvency: A healthy Altman-Z score of 4.27 suggests low bankruptcy risk.
• Debt Management: A manageable debt-to-equity ratio of 0.39 supports financial stability.

One area of caution is liquidity, where ATGE’s current and quick ratios (both 0.83) fall below industry norms. However, its strong cash flow generation helps mitigate this concern.

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

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

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should always conduct your own analysis before making investment decisions.