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Afya (AFYA) Gains As Market Dips: What You Should Know

·3-min read

In the latest trading session, Afya (AFYA) closed at $11.56, marking a +0.09% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.12%. Elsewhere, the Dow gained 0.09%, while the tech-heavy Nasdaq added 0.41%.

Coming into today, shares of the medical education company had gained 19.57% in the past month. In that same time, the Consumer Discretionary sector gained 6.63%, while the S&P 500 gained 8.25%.

Investors will be hoping for strength from Afya as it approaches its next earnings release, which is expected to be August 22, 2022. On that day, Afya is projected to report earnings of $0.23 per share, which would represent year-over-year growth of 666.67%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $119.45 million, up 69.94% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.06 per share and revenue of $492.92 million. These totals would mark changes of +27.71% and +54.68%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Afya. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Afya is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Afya has a Forward P/E ratio of 10.9 right now. This valuation marks a discount compared to its industry's average Forward P/E of 15.03.

Also, we should mention that AFYA has a PEG ratio of 0.34. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Schools industry currently had an average PEG ratio of 0.8 as of yesterday's close.

The Schools industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 102, putting it in the top 41% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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