Head-To-Head Review: Strategic Education (STRA) versus The Competition

Strategic Education (NASDAQ:STRA) is one of 166 public companies in the “Diversified Consumer Services” industry, but how does it contrast to its competitors? We will compare Strategic Education to similar companies based on the strength of its analyst recommendations, institutional ownership, earnings, risk, profitability, valuation and dividends.

Profitability

This table compares Strategic Education and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Strategic Education	10.46%	8.98%	7.11%
Strategic Education Competitors	-3.01%	-28.38%	2.46%

Institutional & Insider Ownership

93.3% of Strategic Education shares are owned by institutional investors. Comparatively, 49.0% of shares of all “Diversified Consumer Services” companies are owned by institutional investors. 3.6% of Strategic Education shares are owned by company insiders. Comparatively, 19.5% of shares of all “Diversified Consumer Services” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

Strategic Education pays an annual dividend of $2.40 per share and has a dividend yield of 3.3%. Strategic Education pays out 40.0% of its earnings in the form of a dividend. As a group, “Diversified Consumer Services” companies pay a dividend yield of 6.0% and pay out 36.2% of their earnings in the form of a dividend. Strategic Education lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Risk and Volatility

Strategic Education has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500. Comparatively, Strategic Education’s competitors have a beta of 0.47, meaning that their average share price is 53% less volatile than the S&P 500.

Earnings & Valuation

This table compares Strategic Education and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Strategic Education	$1.27 billion	$126.61 million	12.16
Strategic Education Competitors	$3.54 billion	$219.82 million	11.89

Strategic Education’s competitors have higher revenue and earnings than Strategic Education. Strategic Education is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of recent ratings and price targets for Strategic Education and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Strategic Education	0	3	2	0	2.40
Strategic Education Competitors	1432	3426	5275	196	2.41

Strategic Education presently has a consensus target price of $96.67, suggesting a potential upside of 32.49%. As a group, “Diversified Consumer Services” companies have a potential upside of 64.60%. Given Strategic Education’s competitors stronger consensus rating and higher possible upside, analysts clearly believe Strategic Education has less favorable growth aspects than its competitors.

Summary

Strategic Education competitors beat Strategic Education on 9 of the 15 factors compared.

Strategic Education Company Profile

Strategic Education, Inc., through its subsidiaries, provides education services through campus-based and online post-secondary education, and programs to develop job-ready skills. The company operates through U.S. Higher Education, Australia/New Zealand, and Education Technology Services segments. It operates Strayer University that offers undergraduate and graduate degree programs in business, criminal justice, education, health services, information technology, and public administration at physical campuses located in the eastern United States, as well as through online; non-degree web and mobile application development courses through Hackbright Academy and Devmountain; and MBA online through its Jack Welch Management Institute. In addition, the company operates Capella University that provides post-secondary education; Torrens University, which offers undergraduate, graduate, higher degree by research, and specialized degree courses primarily in business, design and creative technology, health, hospitality, and education fields through online and on physical campuses located in Australia; Think Education, a vocational training organization; and Media Design School, which provides industry-endorsed courses in 3D animation and visual effects, game art and programming, graphic and motion design, digital media artificial intelligence, and creative advertising in New Zealand. It also offers Workforce Edge, a platform to employers that provides education benefits administration solutions; and Sophia Learning, which enables lower cost education benefits programs. Strategic Education, Inc. was founded in 1892 and is headquartered in Herndon, Virginia.