STRATEGIC EDUCATION INC (STRA) Stock Fundamental Analysis
NASDAQ:STRA - Nasdaq - US86272C1036 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to STRA. STRA was compared to 72 industry peers in the Diversified Consumer Services industry. While STRA belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. STRA may be a bit undervalued, certainly considering the very reasonable score on growth STRA also has an excellent dividend rating. This makes STRA very considerable for value and dividend investing!
1. Profitability
1.1 Basic Checks
STRA had positive earnings in the past year.
In the past year STRA had a positive cash flow from operations.
Each year in the past 5 years STRA has been profitable.
In the past 5 years STRA always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of STRA (5.43%) is better than 69.44% of its industry peers.
STRA has a better Return On Equity (6.86%) than 62.50% of its industry peers.
STRA has a Return On Invested Capital of 6.25%. This is in the better half of the industry: STRA outperforms 73.61% of its industry peers.
STRA had an Average Return On Invested Capital over the past 3 years of 4.24%. This is significantly below the industry average of 10.64%.
The last Return On Invested Capital (6.25%) for STRA is above the 3 year average (4.24%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.43% | ||
| ROE | 6.86% | ||
| ROIC | 6.25% |
ROA(3y)3.65%
ROA(5y)3.42%
ROE(3y)4.62%
ROE(5y)4.4%
ROIC(3y)4.24%
ROIC(5y)4.18%
1.3 Margins
STRA has a Profit Margin of 9.14%. This is in the better half of the industry: STRA outperforms 70.83% of its industry peers.
In the last couple of years the Profit Margin of STRA has grown nicely.
The Operating Margin of STRA (13.23%) is better than 72.22% of its industry peers.
In the last couple of years the Operating Margin of STRA has remained more or less at the same level.
STRA has a Gross Margin (47.21%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of STRA has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.23% | ||
| PM (TTM) | 9.14% | ||
| GM | 47.21% |
OM growth 3Y9.44%
OM growth 5Y-0.54%
PM growth 3Y23.79%
PM growth 5Y2.58%
GM growth 3Y0.31%
GM growth 5Y-0.05%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so STRA is destroying value.
Compared to 1 year ago, STRA has more shares outstanding
STRA has more shares outstanding than it did 5 years ago.
STRA has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 3.72 indicates that STRA is not in any danger for bankruptcy at the moment.
STRA has a better Altman-Z score (3.72) than 76.39% of its industry peers.
STRA has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 3.72 |
ROIC/WACC0.7
WACC8.99%
2.3 Liquidity
A Current Ratio of 1.27 indicates that STRA should not have too much problems paying its short term obligations.
STRA has a Current ratio (1.27) which is in line with its industry peers.
STRA has a Quick Ratio of 1.27. This is a normal value and indicates that STRA is financially healthy and should not expect problems in meeting its short term obligations.
STRA's Quick ratio of 1.27 is in line compared to the rest of the industry. STRA outperforms 55.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.27 | ||
| Quick Ratio | 1.27 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 10.48% over the past year.
Measured over the past years, STRA shows a decrease in Earnings Per Share. The EPS has been decreasing by -6.07% on average per year.
STRA shows a small growth in Revenue. In the last year, the Revenue has grown by 5.72%.
The Revenue has been growing slightly by 4.12% on average over the past years.
EPS 1Y (TTM)10.48%
EPS 3Y0.34%
EPS 5Y-6.07%
EPS Q2Q%17.12%
Revenue 1Y (TTM)5.72%
Revenue growth 3Y2.53%
Revenue growth 5Y4.12%
Sales Q2Q%4.6%
3.2 Future
STRA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 18.25% yearly.
STRA is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.35% yearly.
EPS Next Y17.99%
EPS Next 2Y18.25%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year3.69%
Revenue Next 2Y4.35%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 15.35, STRA is valued correctly.
Based on the Price/Earnings ratio, STRA is valued cheaply inside the industry as 83.33% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.46. STRA is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 11.40 indicates a reasonable valuation of STRA.
86.11% of the companies in the same industry are more expensive than STRA, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of STRA to the average of the S&P500 Index (36.44), we can say STRA is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.35 | ||
| Fwd PE | 11.4 |
4.2 Price Multiples
STRA's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. STRA is cheaper than 77.78% of the companies in the same industry.
80.56% of the companies in the same industry are more expensive than STRA, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.95 | ||
| EV/EBITDA | 8.18 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
STRA has a very decent profitability rating, which may justify a higher PE ratio.
STRA's earnings are expected to grow with 18.25% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.85
PEG (5Y)N/A
EPS Next 2Y18.25%
EPS Next 3YN/A
5. Dividend
5.1 Amount
STRA has a Yearly Dividend Yield of 3.00%.
Compared to an average industry Dividend Yield of 3.54, STRA pays a better dividend. On top of this STRA pays more dividend than 97.22% of the companies listed in the same industry.
STRA's Dividend Yield is a higher than the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3% |
5.2 History
The dividend of STRA has a limited annual growth rate of 2.49%.
STRA has been paying a dividend for at least 10 years, so it has a reliable track record.
As STRA did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)2.49%
Div Incr Years0
Div Non Decr Years7
5.3 Sustainability
STRA pays out 52.37% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of STRA is growing, but earnings are growing more, so the dividend growth is sustainable.
DP52.37%
EPS Next 2Y18.25%
EPS Next 3YN/A
77.66
-1.75 (-2.2%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)
Earnings (Next)
Inst Owners94.54%
Inst Owner Change-0.01%
Ins Owners3.03%
Ins Owner Change3.86%
Market Cap1.88B
Analysts84.44
Price Target104.72 (34.84%)
Short Float %2.07%
Short Ratio2.71
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3% |
Yearly Dividend2.41
Dividend Growth(5Y)2.49%
DP52.37%
Div Incr Years0
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)18%
Min EPS beat(2)0.41%
Max EPS beat(2)35.59%
EPS beat(4)4
Avg EPS beat(4)21.84%
Min EPS beat(4)0.41%
Max EPS beat(4)41.57%
EPS beat(8)8
Avg EPS beat(8)28.48%
EPS beat(12)10
Avg EPS beat(12)19.54%
EPS beat(16)12
Avg EPS beat(16)12.12%
Revenue beat(2)0
Avg Revenue beat(2)-2.04%
Min Revenue beat(2)-3.12%
Max Revenue beat(2)-0.96%
Revenue beat(4)0
Avg Revenue beat(4)-1.31%
Min Revenue beat(4)-3.12%
Max Revenue beat(4)-0.5%
Revenue beat(8)1
Avg Revenue beat(8)-0.32%
Revenue beat(12)1
Avg Revenue beat(12)-0.99%
Revenue beat(16)1
Avg Revenue beat(16)-1.59%
PT rev (1m)0%
PT rev (3m)-8.61%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2.02%
EPS NY rev (1m)0%
EPS NY rev (3m)5.59%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.41%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.35 | ||
| Fwd PE | 11.4 | ||
| P/S | 1.52 | ||
| P/FCF | 15.95 | ||
| P/OCF | 11.77 | ||
| P/B | 1.14 | ||
| P/tB | 9.97 | ||
| EV/EBITDA | 8.18 |
EPS(TTM)5.06
EY6.52%
EPS(NY)6.81
Fwd EY8.77%
FCF(TTM)4.87
FCFY6.27%
OCF(TTM)6.6
OCFY8.49%
SpS51.05
BVpS68.02
TBVpS7.79
PEG (NY)0.85
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.43% | ||
| ROE | 6.86% | ||
| ROCE | 8.99% | ||
| ROIC | 6.25% | ||
| ROICexc | 6.95% | ||
| ROICexgc | 64.11% | ||
| OM | 13.23% | ||
| PM (TTM) | 9.14% | ||
| GM | 47.21% | ||
| FCFM | 9.54% |
ROA(3y)3.65%
ROA(5y)3.42%
ROE(3y)4.62%
ROE(5y)4.4%
ROIC(3y)4.24%
ROIC(5y)4.18%
ROICexc(3y)4.74%
ROICexc(5y)4.68%
ROICexgc(3y)39.25%
ROICexgc(5y)36.61%
ROCE(3y)6.09%
ROCE(5y)6%
ROICexcg growth 3Y24.96%
ROICexcg growth 5Y0.87%
ROICexc growth 3Y16.27%
ROICexc growth 5Y-3.19%
OM growth 3Y9.44%
OM growth 5Y-0.54%
PM growth 3Y23.79%
PM growth 5Y2.58%
GM growth 3Y0.31%
GM growth 5Y-0.05%
F-Score7
Asset Turnover0.59
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 93.72% | ||
| Cap/Sales | 3.38% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 76.75% | ||
| Profit Quality | 104.37% | ||
| Current Ratio | 1.27 | ||
| Quick Ratio | 1.27 | ||
| Altman-Z | 3.72 |
F-Score7
WACC8.99%
ROIC/WACC0.7
Cap/Depr(3y)74.79%
Cap/Depr(5y)63%
Cap/Sales(3y)3.55%
Cap/Sales(5y)3.91%
Profit Quality(3y)135.55%
Profit Quality(5y)151.19%
High Growth Momentum
Growth
EPS 1Y (TTM)10.48%
EPS 3Y0.34%
EPS 5Y-6.07%
EPS Q2Q%17.12%
EPS Next Y17.99%
EPS Next 2Y18.25%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)5.72%
Revenue growth 3Y2.53%
Revenue growth 5Y4.12%
Sales Q2Q%4.6%
Revenue Next Year3.69%
Revenue Next 2Y4.35%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y13.11%
EBIT growth 3Y12.22%
EBIT growth 5Y3.55%
EBIT Next Year61.28%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y87.04%
FCF growth 3Y-0.6%
FCF growth 5Y-4.65%
OCF growth 1Y52.2%
OCF growth 3Y-2.11%
OCF growth 5Y-3.48%