ATGE or BFAM: Which Is the Better Value Stock Right Now?
ATGE vs. BFAM: Which Stock Is the Better Value Option?
Investors with an interest in Schools stocks have likely encountered both Adtalem Global Education (ATGE) and Bright Horizons Family Solutions (BFAM). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Adtalem Global Education has a Zacks Rank of #1 (Strong Buy), while Bright Horizons Family Solutions has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ATGE has an improving earnings outlook. However, value investors will care about much more than just this.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
ATGE currently has a forward P/E ratio of 8.79, while BFAM has a forward P/E of 65.60. We also note that ATGE has a PEG ratio of 0.59. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. BFAM currently has a PEG ratio of 2.73.
Another notable valuation metric for ATGE is its P/B ratio of 1.46. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BFAM has a P/B of 6.88.
Based on these metrics and many more, ATGE holds a Value grade of B, while BFAM has a Value grade of C.
ATGE stands above BFAM thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ATGE is the superior value option right now.
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Adtalem Global Education Inc. (ATGE): Free Stock Analysis Report
Bright Horizons Family Solutions Inc. (BFAM): Free Stock Analysis Report
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