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BPI vs. CECO: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Schools sector might want to consider either Bridgepoint Education or Career Education (CECO - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Currently, Bridgepoint Education has a Zacks Rank of #2 (Buy), while Career Education has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BPI is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

BPI currently has a forward P/E ratio of 15.14, while CECO has a forward P/E of 16.58. We also note that BPI has a PEG ratio of 1.51. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CECO currently has a PEG ratio of 1.66.

Another notable valuation metric for BPI is its P/B ratio of 1.82. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, CECO has a P/B of 3.11.

Based on these metrics and many more, BPI holds a Value grade of A, while CECO has a Value grade of C.

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


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