Stock In Focus – TAM Stock Screener – Perdoceo Education Corp (NASDAQ: PRDO)

Johnny HopkinsStock Screener1 Comment

As part of our ongoing series here at The Acquirer’s Multiple, we provide this feature article titled ‘Stock in Focus‘ where we focus on one of the stocks from our Stock Screeners.

One of the cheapest stocks in our Stock Screeners is:

Perdoceo Education Corp (NASDAQ: PRDO)

Perdoceo Education Corp is an American for-profit education company that focuses on campus and online post-secondary programs. The company’s important segment is its online universities, which include the American InterContinental University, and Colorado Technical University. These online universities provide undergraduate, graduate, and doctoral degree programs focusing on business, technology, management, and social services. Career Education Corporation is focusing on its online universities as it continues to reduce its on-campus program offerings. The majority of the company’s revenue comes from the Colorado Technical University segment.

A quick look at the share price history (below) over the past twelve months shows that the price is down 5%. Here’s why the company is undervalued.


Market Cap: $793 Million

Enterprise Value: $339 Million

Operating Earnings

Operating Earnings: $149 Million

Acquirer’s Multiple

Acquirer’s Multiple: 2.30

Free Cash Flow (TTM)

Free Cash Flow: $181 Million

FCF/EV Yield

FCF/EV Yield: 22%

Other Indicators

Piotroski F-Score: 6

Altman Z-Score: 4.75

Beneish M-Score: -2.72

Shareholder Yield

Shareholder Yield: 3.1%

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One Comment on “Stock In Focus – TAM Stock Screener – Perdoceo Education Corp (NASDAQ: PRDO)”

  1. This is not a comment on how well PRDO will do in the next 12 months. I have no opinion on that. It is to urge a broader perspective when making investment decisions about FPHE stocks. Basic financial metrics are not enough. Because the risks are so high, I recommend having a solid understanding of the federal, state, accreditation, and for some programs, licensing environments, both current and with respect to planned or probable future changes. I invested in this sector for more than two decades and did well throughout that period. Looking back, the reasons I did well had little to do with financial metrics. It was because I knew the CEOs and how they were running their companies, and I understood what was going on at the USDOEd, and the accrediting and licensing bodies, etc. For a stock like PRDO, I would also want to have taken the political temperature of the relevant state attorney’s general. Over the years, several AGs have launched their gubernatorial careers on campaigns to close down for-profit colleges. (Colorado is a complicated story that I will not go into here.) Some of these target schools were bad actors and needed to be closed but the only error of many other schools was attempting to educate the underclass that the state and independent colleges do not want, and doing so under the aegis of an IRS for-profit status.

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