Today's Perilous Reversal Stock: DeVry Education Group (DV)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified DeVry Education Group ( DV) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified DeVry Education Group as such a stock due to the following factors:

  • DV has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $36.8 million.
  • DV has traded 603,549 shares today.
  • DV is down 3.2% today.
  • DV was up 13.9% yesterday.

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More details on DV:

DeVry Education Group Inc. provides educational services worldwide. The stock currently has a dividend yield of 0.8%. DV has a PE ratio of 27.8. Currently there are 2 analysts that rate DeVry Education Group a buy, no analysts rate it a sell, and 10 rate it a hold.

The average volume for DeVry Education Group has been 573,600 shares per day over the past 30 days. DeVry Education Group has a market cap of $2.6 billion and is part of the services sector and diversified services industry. The stock has a beta of 1.18 and a short float of 12.4% with 8.50 days to cover. Shares are up 29.6% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates DeVry Education Group as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:
  • Compared to its closing price of one year ago, DV's share price has jumped by 48.98%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • DV has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.40, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for DEVRY EDUCATION GROUP INC is rather high; currently it is at 51.09%. Regardless of DV's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 11.19% trails the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Diversified Consumer Services industry. The net income has decreased by 2.3% when compared to the same quarter one year ago, dropping from $56.82 million to $55.53 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Diversified Consumer Services industry and the overall market, DEVRY EDUCATION GROUP INC's return on equity is below that of both the industry average and the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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