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LOPE, UTI, STRA, REVU, LTRE, LINC, Schools Stocks 11.42% undervalued

^{Published on 2011-01-26 12:31:00 - WOPRAI}
 

January 26, 2011 / M2 PRESSWIRE / BUYINS.NET / http://www.squeezetrigger.com is monitoring the Schools sector and these stocks are the most undervalued as of today. GRAND CANYON EDUCATION INC (NASDAQ:LOPE), UNIVERSAL TECHNICAL INSTITUT (NYSE:UTI), STRAYER EDUCATION INC (NASDAQ:STRA), PRINCETON REVIEW INC (NASDAQ:REVU), LEARNING TREE INTERNATIONAL (NASDAQ:LTRE), LINCOLN EDUCATIONAL SERVICES (NASDAQ:LINC) are all expected to go Up as they are undervalued according to industry standard valuation metrics. The valuation model employs a three-factor approach to stock valuation using fundamental variables--the company's trailing 12-month Earnings-Per-Share (EPS), the analyst consensus estimate of the company's forecasted 12-month EPS, and the 30-year Treasury yield--to create a highly accurate reflection of a company's fair value.

The chart below displays the projected Fair Value and Valuation discount/premium of the most undervalued stocks in the highlighted industry group:

     Symbol     Company Name                        Last Close     Fair Value     Valuation                   Industry               
     LOPE       GRAND CANYON EDUCATION INC          18.25          20.6           11.42% undervalued          Schools                
     UTI        UNIVERSAL TECHNICAL INSTITUT        19.1           25.11          23.93% undervalued          Schools                
     STRA       STRAYER EDUCATION INC               118.82         220.67         46.15% undervalued          Schools                
     REVU       PRINCETON REVIEW INC                1.2            3.52           65.94% undervalued          Schools                
     LTRE       LEARNING TREE INTERNATIONAL         8.92           11.91          25.11% undervalued          Schools                
     LINC       LINCOLN EDUCATIONAL SERVICES        15.01          19.1           21.43% undervalued          Schools                

Here are some of the variables that are utilized when calculating the Fair Market Valuation of a stock: Long-run EPS growth rate, Duration of Business-growth-cycle, Volatility of EPS growth rate, Systematic or beta risk of the firm, Correlation between the firm's EPS and the interest rate environment, EPS growth volatility, Dividend payout ratio, Buffer earnings, Interest rate related criteria: Interest rate (30 year yield) long-run level, Duration of interest rate cycle, Interest rate volatility. The Fair Market Valuation uses 12-month historic and forecasted EPS values and the current 30-year treasury yield as primary determinants. When calculating risk/return values such as the Sharpe ratio, the historic periods used are five years.

Some expected results of the Valuation Model are: the valuation of a stock increases in a declining interest rate environment. Increasing current and/or projected EPS will produce a higher Valuation. While long-term EPS growth would produce a corresponding long-term Valuation increase, concomitant long-term interest rate increases would offset EPS growth and depress the Valuation. The shorter a company's own business cycle, the higher its stock Valuation will be.

GRAND CANYON EDUCATION INC (NASDAQ:LOPE) - Grand Canyon Education, Inc. provides online postsecondary education services in the United States. It focuses on offering graduate and undergraduate degree programs in education, business, and healthcare disciplines. The company also offers ground and onsite programs. As of December 31, 2009, it enrolled approximately 37,700 students. The company was formerly known as Significant Education, Inc. and changed its name to Grand Canyon Education, Inc. in May 2008. Grand Canyon Education, Inc. was founded in 1949 and is based in Phoenix, Arizona.

UNIVERSAL TECHNICAL INSTITUT (NYSE:UTI) - Universal Technical Institute, Inc. provides postsecondary education for students seeking careers as professional automotive, diesel, collision repair, motorcycle, and marine technicians in the United States. As of September 30, 2009, it offered undergraduate degree, diploma, and certificate programs at 10 campuses in the United States under the banner of brands, including Universal Technical Institute, Motorcycle Mechanics Institute and Marine Mechanics Institute, and NASCAR Technical Institute. The company also provides manufacturer training programs that are sponsored by manufacturers or dealers at various training centers. In addition, it offers training for other sectors, such as motor freight companies and other businesses that employ skilled technicians. The company was founded in 1965 and is headquartered in Phoenix, Arizona.

STRAYER EDUCATION INC (NASDAQ:STRA) - Strayer Education, Inc., through its subsidiary, Strayer University, Inc., provides various academic programs through traditional classrooms and Internet. The company provides undergraduate and graduate degree programs in business administration, accounting, information technology, education, health care, public administration, and criminal justice through 78 campuses in Alabama, Delaware, Florida, Georgia, Kentucky, Maryland, New Jersey, North Carolina, Pennsylvania, South Carolina, Tennessee, Utah, Virginia, West Virginia, and Washington, D.C. As of December 31, 2009, it had approximately 54,000 students enrolled in its various programs. The company was founded in 1892 and is based in Arlington, Virginia.

PRINCETON REVIEW INC (NASDAQ:REVU) - The Princeton Review, Inc. provides integrated classroom-based, print, and online products and services to the high school and post-secondary markets in the United States and internationally. Its Test Preparation Services division provides live and online test preparation courses, as well as individual and small group tutoring in test preparation and academic subjects. This division also offers test preparation courses through its independent international franchisees, and sells 165 print and software titles on test preparation, academic admissions, and related topics under the Princeton Review brand. As of December 31, 2009, the company had 20 franchises operating in 21 countries internationally. The companys Supplemental Educational Services division provides tutoring and supplemental educational services under the No Child Left Behind Act of 2001 to students in schools and school districts in the United States. Its Penn Foster division provides online job-training and career accreditation programs. This division offers career-focused online degree and vocational programs primarily through its Penn Foster College, Penn Foster Career School, and Penn Foster High School to approximately 200,000 students worldwide. The company was founded in 1981 and is headquartered in Framingham, Massachusetts.

LEARNING TREE INTERNATIONAL (NASDAQ:LTRE) - Learning Tree International, Inc. and its subsidiaries develop, market, and deliver a library of instructor-led classroom courses for the professional development needs of managers and information technology professionals worldwide. It provides education across various technical and management disciplines, including operating systems, databases, computer networks, computer and network security, Web development, programming languages, software engineering, open source applications, project management, business skills, and leadership and professional development. As of October 2, 2009, the company had 219 course titles representing 4,986 hours of training, including 143 information technology course titles and 76 management course titles comprising courses from 2 to 5 days in length. It markets and sells its course offerings through various channels, including direct mail, electronic marketing, telemarketing, and field sales. The company serves a range of organizations, including large national and multinational companies, government organizations, and small and medium-size companies. Learning Tree International was founded in 1974 and is headquartered in Reston, Virginia.

LINCOLN EDUCATIONAL SERVICES (NASDAQ:LINC) - Lincoln Educational Services Corporation provides career-oriented post-secondary education services in the United States. It offers degree and diploma programs for high school graduates and working adults in the areas of health sciences, automotive technology, skilled trades, hospitality services, and business and information technology. The health sciences programs consist of medical assisting technology, medical administrative assistant technology, dental office management, child development, health information coding, medical office management, medical assistant, mortuary science, nuclear medicine, occupational therapy assistant, dental hygiene, and dental administrative assistant; and automotive technology programs comprise auto service management, collision repair, diesel technology, and diesel and truck service management. The skilled trades programs comprise mechanical/architectural drafting, electronics engineering technology, and HVAC; and hospitality services programs include culinary arts and management, cosmetology management, food and beverage, baking and pastry, hotel restaurant management, dietetic technician, and travel and tourism. The business and information technology programs comprise PC systems and networking technology, business administration, criminal justice, business management, business marketing, accounting, broadcasting and communications, fashion merchandising, and paralegal. It also provides online education services. As of December 31, 2009, the company had 29,340 students enrolled in its programs; and operated 43 campuses in 17 states under the names of Lincoln Technical Institute, Lincoln College of Technology, Lincoln College of New England, Nashville Auto-Diesel College, Southwestern College, Clemens College, and Euphoria Institute of Beauty Arts and Sciences. The company was founded in 1946 and is based in West Orange, New Jersey.

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