Don’t Get Schooled By DeVry Inc. (DV)

Strayer posted third quarter 2012 earnings of $0.36 per share, which was better than the company’s expected range of $0.30 to $0.32. Yet, this is not as impressive as it sounds, as it was still down from the EPS of $1.20 that the company reported for the same quarter last year. Again, much like DeVry, low enrollment is plaguing Strayer, where total enrollment for the 2012 fall term was down 5% year over year.

Apollo is the industry leader in the U.S. private education and has one of the best recognized names in online education, University of Phoenix. Apollo has also been working on various cost saving initiatives, including layoffs and campus closings, where the company aims to decrease its ground location square footage by closing 115 locations by the end of fiscal 2013.

Don’t be fooled

Industry regulation changes have impacted the enrollment numbers for for-profit online educators across the board, but Apollo has the most attractive valuation and return metrics to make it a compelling buy. Of all the major online education companies, Apollo is the only one that trades at price to earnings to growth ratio of less than 1.0, implying that investors can buy the stock and its potential earnings growth at a reasonable price.

The article Don’t Get Schooled By DeVry originally appeared on Fool.com and is written by Marshall Hargrave.

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