Head-To-Head Analysis: Aspen Group (ASPU) vs. K12 (LRN)

Aspen Group (NASDAQ: ASPU) and K12 (NYSE:LRN) are both small-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, earnings, profitability, dividends, risk, institutional ownership and analyst recommendations.

Institutional & Insider Ownership

5.8% of Aspen Group shares are held by institutional investors. Comparatively, 82.4% of K12 shares are held by institutional investors. 26.3% of Aspen Group shares are held by company insiders. Comparatively, 9.6% of K12 shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Aspen Group and K12’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Aspen Group $14.25 million 9.39 -$1.10 million ($0.10) -72.90
K12 $888.52 million 0.76 $450,000.00 $0.45 36.40

K12 has higher revenue and earnings than Aspen Group. Aspen Group is trading at a lower price-to-earnings ratio than K12, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Aspen Group and K12’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Aspen Group -21.59% -35.74% -18.98%
K12 1.32% 3.75% 2.90%

Analyst Recommendations

This is a breakdown of recent ratings for Aspen Group and K12, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Aspen Group 0 1 2 0 2.67
K12 0 0 2 0 3.00

Aspen Group currently has a consensus target price of $12.13, indicating a potential upside of 66.32%. K12 has a consensus target price of $20.50, indicating a potential upside of 25.15%. Given Aspen Group’s higher possible upside, equities analysts plainly believe Aspen Group is more favorable than K12.

Risk and Volatility

Aspen Group has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500. Comparatively, K12 has a beta of -0.02, meaning that its share price is 102% less volatile than the S&P 500.

Summary

K12 beats Aspen Group on 9 of the 13 factors compared between the two stocks.

Aspen Group Company Profile

Aspen Group, Inc. provides online higher education services in the United States. The company offers certificate programs; and associate, bachelor's, master's, and doctoral degree programs in a range of areas, including nursing, business, education, technology, and professional studies. As of April 30, 2017, it had 4,681 degree-seeking students enrolled. The company was founded in 1987 and is headquartered in Denver, Colorado.

K12 Company Profile

K12 Inc., a technology-based education company, together with its subsidiaries, provides online curriculum, software systems, and educational services to facilitate individualized learning for students primarily in kindergarten through 12th grade in the United States and internationally. It manages virtual and blended public schools. The company also offers curriculum and technology solutions; full-time virtual and blended programs, semester courses, and supplemental educational products; teacher training, teaching, and other support services to public schools, school districts, private schools, charter schools, early childhood learning centers, and corporate partners. In addition, it provides FuelEd suite of offerings, such as K12 curriculum, FuelEd online courses, and FuelEd anywhere learning systems; and PEAK, a proprietary software system designed to manage in a single-user interface, multiple, and independent online school-based functions. Further, the company operates online private schools, including The K12 International Academy, the George Washington University Online High School, and the Keystone School. Additionally, it provides access to the online lessons and curriculum through proprietary learning management system; learning kits; student computers; and management, technology, and educational services. The company sells individual online courses directly to families who desire to educate their children outside of the traditional public school system or to supplement their child's existing public school education without the aid of an online teacher. K12 Inc. was founded in 2000 and is headquartered in Herndon, Virginia.

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