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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Grand Canyon Education, Inc. (XNAS:LOPE) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
LOPE
Name:
GRAND CANYON EDUCATION, INC. (XNAS:LOPE)
Sector:
63.38M
Industry:
Education & Training Services
CEO:
Mr. Brian Mueller
Total Employees:
3,675
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is 17.26% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF GRAND CANYON EDUCATION, INC.(LOPE) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND EDUCATION & TRAINING SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
81.08
One Month Price Target:
$81.3
Six Month Price Target :
$82.38
Likely Price in One Year's Time:
Ticker:
$83.67
Likely Trading Range Today Under (Normal Volatility)
$80.77
Price Upper limit ($) :
$81.42
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$77.16
This week:
$72.31
This month :
$63.55
Other Primary facts
Market Cap:
2.54B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
31.96M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
10.57%
-16.03%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$99.28
$90.98
$62.88
$71.18
Medium risk (<10%) entry points
Buy Call
Sell Call
$88.28
Buy Put:
Sell Put:
$86.50
$73.86
$75.66
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
LOPE
Sharpe Ratio:
0.29%
Comparison:
LOPE, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -137.81% lower than the industry
& is -87.36% lower than the market/S&P 500 average
Average Returns/Yield of
LOPE
Daily returns:
0.02%
Weekly returns:
0.08%
Monthly returns:
0.31%
Yearly returns:
-3.84%
Comparison of returns:
Average annual returns/yield (last 3 years) is -197.87% below industry average
Classification:
LOPE, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.19
Statistical test of Returns:
LOPE has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.36%
Weekly Volatility:
5.28%
Monthly Volatility:
10.56%
Yearly Volatility:
36.59%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.68%
Volatility in last five trading days has been -71.03% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.84%
Weekly VaR:
-10.81%
Monthly VaR:
-21.62%
How Much Can the price of
LOPE
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-19%
Worst case (decline):
-74.90%
This translates to price declining to:
$65.72
This translates to price declining to:
$20.35
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
LOPE is a 52.61% riskier investment compared to the market/S&P 500 & is 30.74% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -32.26% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
LOPE
Beta in relation to market/S&P 500--0.48
Expected beta in 1 year's time:
0.562
Expected beta in 3 year's time:
0.795
Unlevered (debt free) Beta:
0.45
Beta in relation to Nasdaq (XNAS):
0.555
Beta in relation to all global stocks::
0.548
Beta Comparison & Analysis
Beta of competitors/peers::
0.861
Beta is -44.73% lower than peers
Average Industry Beta:
0.833
Beta is -42.90% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
17.16%
Sustainable growth rate is -46.18% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.027
Alpha is -79.11% below industry average alpha yield
Alpha is -169% below the market average
Analysis of Cost of Capital of
LOPE
Equity cost of capital:
0.064
Equity cost of capital is -27.65% below industry mean WACC
Unlevered (without debt) cost of capital:
6.07%
Before-tax cost of debt:
5.06%
After-tax cost of debt:
4.00%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
4.00%
WACC is -11.80% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$28.28
Revenue growth rate per share of (3Y):
3.67
Annual revenue growth rate is -25.24% below industry average
EPS:
$5.97
Expected Annual growth rate of EPS (3Y):
2.99%
Expected future EPS growth rate is -125.55% lower than the Education & Training Services industry
Free cash flow (FCF) per share:
$7.56
-
-
Debt per share
$1.62
EBITDA per share
$10.78
Valuation Analysis Today of
LOPE
P/E Ratio:
14.25
P/E Ratio of Competitors/Peers:
250.88
P/E ratio is -94.32% lower than main peers & is 34.54% higher than the industry
Stock price/value with industry average P/E ratio: $63.23
LOPE is 28.23% overvalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
2.87
Price to sales ratio is 15.35% above the industry mean
P/B (Price to book value ratio):
3.67
Price to free cash flow: 10.73
Price to free cash flow ratio is -19.95% lower than the industry
Net income growth rate (3Y):
23.47%
Net income growth rate is -149.81% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
7.34%
Net debt to equity ratio:
-20.18%
Debt to assets ratio:
5.65%
Net debt to assets ratio:
-15.52%
Debt-to-asset ratio is -88.14% below industry average
Ability to repay debt:
Interest coverage ratio:
114.59
Interest coverage ratio is 46.80% more than industry average
Looking forward:
Debt growth rate:
-64.38%
Annual debt growth is -701% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.446
Statistical significance of correlation:
LOPE has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.406
Stock price is 9.76% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.406
Correlation of price movement with Nasdaq (^IXIC):
-0.001
Covariance of price movement with the market:
-0.002
Kurtosis
7.029
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.411
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
LOPE
Gross Profit Margin Ratio:
225%
Operating Profit Margin Ratio:
30.48%
Operating profit margin is 122.43% higher than the industry
Net Profit Margin Ratio:
225%
Effective Tax Rate:
22.70%
Effective tax rate is -36.90% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
34.02%
Return on equity (ROE) is 74.95% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
26.17%
Return on assets (ROA) is 316.33% higher than the industry
Financial Leverage:
1.1x
Current Ratio:
2.87
Current ratio is -15.70% below industry average
Cash Conversion Cycle (days):
0.5
Cash conversion cycle is -97.19% below industry average
The remaining useful life of property plant & equipment is: 21.5 years
Stock based compensation to net income ratio:
1.33%
In-depth Efficiency Analysis
Revenue generated per employee:
245.9K
Each employee generates -10% less revenue than industry average revenue per employee
EBITDA generated per employee:
93.8K
Each employee generates 73% more EBITDA than industry average revenue per employee
Profit generated per employee:
65.4K
Each employee generates 216% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
17.2K
Each employee generates 59% more free cash flow than industry average revenue per employee
Assets/Capital per employee
146.4K
Each employee generates 59% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
LOPE
Sprouts Farmers Market, Inc. (XNAS:SFM)
THE SIMPLY GOOD FOODS COMPANY (XNAS:SMPL)
INTER PARFUMS, INC. (XNAS:IPAR)
FRESHPET, INC. (XNAS:FRPT)
THE HAIN CELESTIAL GROUP, INC. (XNAS:HAIN)
J & J SNACK FOODS CORP. (XNAS:JJSF)
KRISPY KREME, INC. (XNAS:DNUT)
CELSIUS HOLDINGS, INC. (XNAS:CELH)
HOSTESS BRANDS, INC. (XNAS:TWNK)
Current Analyst Ratings
Strong buy�8%
Buy�8%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
903.76M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
391.79M
511.98M
-
42.14M
228.13M
185.99M
8.42M
236.55M
38.00M
3.01M
30.71M
344.58M
275.43M
240.31M
310.86M
70.55M
240.31M
Statement of Cash Flow
Date:
Period:
7.83M
Differed Income Tax :
1.48M
Stock Based Compensation :
3.19M
Change in Working Capital :
- 1036.00K
Accounts Receivables:
-
Other Working Capital:
28.42M
Other Non-Cash Items:
719.00K
Net Cash Provided by Operating Activities:
70.26M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
- 62834.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
201.93M
62.40M
264.33M
102.01M
-
14.02M
380.36M
192.35M
160.77M
183.11M
-
-
1.80M
538.03M
-
918.39M
29.64M
7.51M
20.69M
12.17M
83.39M
132.71M
51.87M
30.00K
79.24M
-
211.95M
538.00K
1.91B
- 323.0K
- 1206908.00K
March 31, 2022 at 6:00:00 AM
628.33M
706.44M
918.39M
-
59.38M
- 142553.0K
-
- 6879.00K
- 69713.00K
-
-
- 399555.00K
-
-
- 399555.00K
-
- 399008.00K
201.93M
600.94M
70.26M
- 6879.00K
63.38M
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
LOPE
2023
2024
2025
2026
2027
$84.09
$474.52
$489.70
$505.36
$521.52