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APEI vs. UTI: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Schools sector might want to consider either American Public Education (APEI - Free Report) or Universal Technical Institute (UTI - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, American Public Education is sporting a Zacks Rank of #1 (Strong Buy), while Universal Technical Institute has a Zacks Rank of #5 (Strong Sell). This means that APEI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

APEI currently has a forward P/E ratio of 18.17, while UTI has a forward P/E of 34.82. We also note that APEI has a PEG ratio of 1.21. 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. UTI currently has a PEG ratio of 2.32.

Another notable valuation metric for APEI is its P/B ratio of 2.62. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, UTI has a P/B of 4.61.

These are just a few of the metrics contributing to APEI's Value grade of B and UTI's Value grade of D.

APEI sticks out from UTI in both our Zacks Rank and Style Scores models, so value investors will likely feel that APEI is the better option right now.


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American Public Education, Inc. (APEI) - free report >>

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