Bridgepoint Education (NYSE: BPI) and Grand Canyon Education (NASDAQ:LOPE) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, profitabiliy, earnings, analyst recommendations, valuation, risk and dividends.

Profitability

This table compares Bridgepoint Education and Grand Canyon Education’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bridgepoint Education -1.39% 9.16% 5.13%
Grand Canyon Education 18.77% 21.77% 15.47%

Risk and Volatility

Bridgepoint Education has a beta of 2.17, suggesting that its stock price is 117% more volatile than the S&P 500. Comparatively, Grand Canyon Education has a beta of 1.48, suggesting that its stock price is 48% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Bridgepoint Education and Grand Canyon Education, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bridgepoint Education 0 1 0 0 2.00
Grand Canyon Education 0 0 4 0 3.00

Bridgepoint Education presently has a consensus price target of $14.00, suggesting a potential upside of 43.44%. Grand Canyon Education has a consensus price target of $74.67, suggesting a potential downside of 7.90%. Given Bridgepoint Education’s higher probable upside, research analysts clearly believe Bridgepoint Education is more favorable than Grand Canyon Education.

Institutional & Insider Ownership

91.3% of Bridgepoint Education shares are held by institutional investors. Comparatively, 95.7% of Grand Canyon Education shares are held by institutional investors. 41.5% of Bridgepoint Education shares are held by insiders. Comparatively, 3.0% of Grand Canyon Education shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Bridgepoint Education and Grand Canyon Education’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Bridgepoint Education $510.19 million 0.56 $33.22 million ($0.06) -162.64
Grand Canyon Education $921.61 million 4.14 $310.30 million $3.62 22.40

Grand Canyon Education has higher revenue and earnings than Bridgepoint Education. Bridgepoint Education is trading at a lower price-to-earnings ratio than Grand Canyon Education, indicating that it is currently the more affordable of the two stocks.

Summary

Grand Canyon Education beats Bridgepoint Education on 11 of the 14 factors compared between the two stocks.

Bridgepoint Education Company Profile

Bridgepoint Education, Inc. (Bridgepoint) is a provider of postsecondary education services. The Company’s academic institutions include Ashford University and University of the Rockies. Bridgepoint’s institutions conduct ongoing faculty and student assessment processes, and provide a range of student services. It offers Constellation, its learning platform, Waypoint Outcomes, its assessment software, and its mobile application technology. As of December 31, 2016, its institutions offered over 1,200 courses and over 80 degree programs. Ashford University offers associate’s, bachelor’s and master’s degree programs online. Ashford University comprises four colleges: the Forbes School of Business and Technology, the College of Education, the College of Health, Human Services and Science, and the College of Liberal Arts. University of the Rockies is a graduate institution that offers master’s and doctoral degree programs in the social and behavioral sciences.

Grand Canyon Education Company Profile

Grand Canyon Education, Inc. is engaged in the provision of postsecondary education. The Company is a regionally accredited university. The Company offers the degrees, including Doctor of Education, Doctor of Business Administration, Doctor of Nursing Practice, Doctor of Philosophy, Education Specialist, Master of Divinity, Master of Arts, Master of Education, Master of Business Administration and Master of Public Administration, Master of Public Health, Master of Science, Bachelor of Arts, Bachelor of Science, and a range of programs for its degrees. It also offers certificate programs, which consist of a series of courses focused on a particular area of study for both the post-baccalaureate and post-graduate students. The Company offers its ground-based programs to students through three 15-week semesters in a calendar year and to online students in courses that generally range from 5 to 16 weeks throughout the calendar year.

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