Grand Canyon Education (NASDAQ: LOPE) and Strayer Education (NASDAQ:STRA) are both consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, risk, earnings, analyst recommendations and profitabiliy.

Risk and Volatility

Grand Canyon Education has a beta of 1.48, suggesting that its share price is 48% more volatile than the S&P 500. Comparatively, Strayer Education has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500.

Valuation & Earnings

This table compares Grand Canyon Education and Strayer Education’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Grand Canyon Education $921.61 million 4.15 $310.30 million $3.62 21.94
Strayer Education $449.07 million 1.89 $77.90 million $3.21 24.67

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Grand Canyon Education and Strayer Education, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Grand Canyon Education 0 0 4 0 3.00
Strayer Education 0 3 1 0 2.25

Grand Canyon Education currently has a consensus price target of $74.67, suggesting a potential downside of 6.01%. Strayer Education has a consensus price target of $83.75, suggesting a potential upside of 5.74%. Given Strayer Education’s higher probable upside, analysts clearly believe Strayer Education is more favorable than Grand Canyon Education.

Profitability

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

Net Margins Return on Equity Return on Assets
Grand Canyon Education 18.77% 21.77% 15.47%
Strayer Education 7.90% 17.65% 11.15%

Institutional & Insider Ownership

95.2% of Grand Canyon Education shares are held by institutional investors. Comparatively, 92.3% of Strayer Education shares are held by institutional investors. 3.0% of Grand Canyon Education shares are held by company insiders. Comparatively, 6.7% of Strayer Education shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

Strayer Education pays an annual dividend of $1.00 per share and has a dividend yield of 1.3%. Grand Canyon Education does not pay a dividend. Strayer Education pays out 31.2% of its earnings in the form of a dividend.

Summary

Grand Canyon Education beats Strayer Education on 12 of the 16 factors compared between the two stocks.

Grand Canyon Education Company Profile

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.

Strayer Education Company Profile

Strayer Education, Inc. is an education services holding company. The Company provides post-secondary education and other academic programs, through its subsidiaries, Strayer University (the University) and New York Code and Design Academy (NYCDA). As of December 31, 2016, the University offered undergraduate and graduate degree programs in business administration, accounting, information technology, education, health services administration, nursing, public administration and criminal justice at 74 physical campuses located in the Mid-Atlantic and Southern regions of the United States, and online. The University also offers an executive Master of Business Administration (MBA) online through its Jack Welch Management Institute. Its subsidiary, NYCDA, provides non-degree courses in Web and application software development, primarily at its campus in New York City. Each undergraduate degree program includes courses in oral and written communication skills, as well as mathematics.

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