ATGE - Here's Why You Should Invest in Adtalem Global Education Now

Adtalem Global Education Inc. (ATGE), is one of the 9 stocks featured in a new special report. Claim your copy now! 9 “MUST OWN” Growth Stocks for 2021. 

You might not think that an online education provider is expected to grow earnings 28% this year, but in the case of Adtalem Global Education Inc. (ATGE), it’s true. ATGE is a for-profit education company that operates various university and educational programs. It has eight colleges and universities specializing in business, medicine, education, and nursing degree programs.

The company operates through two segments, Medical and Healthcare and Financial Services. The Medical and Healthcare segment offers degree and non-degree programs in the medical and healthcare postsecondary education industry. It operates Chamberlain University, which has a pre-licensure Bachelor of Science degree in Nursing program. It also offers registered nurses Bachelor of Science degree completion options and other graduate programs.

Chamberlain University offers educational services through its 22 campuses and online, including medical and veterinary schools, like the American University of the Caribbean School of Medicine, the Ross University School of Medicine, and the Ross University School of Veterinary Medicine.

The Financial segment offers test preparation, certifications, conferences, seminars, memberships, and subscriptions to financial professionals. This includes coursework in accounting, anti-money laundering, banking, and mortgage lending. It also operates the Association of Certified Anti-Money Laundering Specialists program.

Its Becker Professional Education program prepares candidates for the Certified Public Accountant and Certified Management Accountant certification examinations. Students can also access compliance training, mortgage licensure preparation, continuing education, and professional development.

Where does all the growth come from? Mainly its focus on the medical and healthcare space. Even before the pandemic, this was a very in-demand sector, but now the demand for nurses is off the charts. Its Chamberlain University is well-positioned to gain from this growing demand. The company is already planning on capitalizing on this by investing in new programs and introducing evening and weekend classes.

In addition, ATGE is focused on partnering with hospitals, businesses, and government agencies to create education programs aimed at teaching new skills to professionals. These collaborations boost student enrollment. The company is also increasing the number of short-term programs to meet student preferences and employer’s needs.

ATGE is developing its hybrid Bachelor of Science degree in Nursing program degree, including online instruction and in-person learning. This will help address the nursing shortage. On the financial side, its OnCourse learning has been a substantial growth catalyst. In the second quarter of fiscal 2021, the financial segment revenues increased 5.9% year over year, driven by higher OnCourse learning revenues.

The company has an overall grade of B, which equates to Buy in our POWR Ratings system. It also holds a Value Grade of B, due to its current attractively priced valuation. ATGE currently has a price-to-earnings ratio (P/E) of only 7.2 and a Price to Book of 1.5, well below the industry average. It also has a Quality Grade of B based on its healthy balance sheet. The company had $460 million in cash as of the end of the year. This is more than enough to handle its $3 million in short-term debt.

We also grade ATGE on Growth, Momentum, Stability, and Sentiment. To access all of ATGE’s grades, click here. ATGE is ranked #7 in the Outsourcing – Education Services industry. For more top stocks in that industry, click this link. 

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ATGE shares were unchanged in premarket trading Friday. Year-to-date, ATGE has gained 11.99%, versus a 1.26% rise in the benchmark S&P 500 index during the same period.

About the Author: David Cohne

David Cohne has 20 years of experience as an investment analyst and writer. Prior to StockNews, David spent eleven years as a Consultant providing outsourced investment research and content to financial services companies, hedge funds, and online publications. David enjoys researching and writing about stocks and the markets. He takes a fundamental quantitative approach in evaluating stocks for readers.

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