If you are wondering whether Perdoceo Education remains a smart opportunity after its big multi year run, or if the easy money has already been made, this overview can help unpack what the current share price implies.
The stock has climbed 10.5% year to date and is up 126.0% over three years, even though the last month saw a pullback of 7.7%. Over the last week it has gained 2.2% after a quieter stretch.
Much of this performance reflects the company steadily shifting toward more career focused programs and digital delivery, while tightening costs and returning capital to shareholders. At the same time, a calmer regulatory backdrop for for profit education and ongoing demand for reskilling have contributed to investors reassessing the long term risk profile of the business.
In that context, Perdoceo currently screens as attractively priced. It scores 5 out of 6 on our valuation checks, which indicates it looks undervalued on most of the key metrics we track. Next, we will walk through the main valuation approaches we use, before finishing with a more nuanced way of thinking about what this price reflects.
A Discounted Cash Flow model estimates what a business is worth by projecting the cash it can generate in the future and discounting those cash flows back to today, using a required rate of return.
For Perdoceo Education, the latest twelve month Free Cash Flow is about $195.0 million. Using a 2 Stage Free Cash Flow to Equity model, future cash flows are projected to grow steadily, reaching around $380.7 million in 2035. Earlier years are modeled with faster growth as the business scales, then growth moderates as it matures, with estimates beyond the near term extrapolated by Simply Wall St.
When all of these future cash flows are discounted back, the model arrives at an intrinsic value of roughly $109.13 per share. Compared with the current market price, this implies the stock is about 73.5% undervalued, indicating that, under these assumptions, investors are paying less than what the projected cash generation would justify.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Perdoceo Education is undervalued by 73.5%. Track this in your watchlist or portfolio, or discover 904 more undervalued stocks based on cash flows.
PRDO Discounted Cash Flow as at Dec 2025
Story Continues
For consistently profitable businesses like Perdoceo Education, the price to earnings (PE) ratio is a practical way to gauge whether investors are paying a reasonable price for each dollar of current earnings. In general, faster growth and lower perceived risk justify a higher PE, while slower growth or higher uncertainty usually deserve a lower multiple.
Perdoceo currently trades on a PE of about 11.9x, which sits below both the broader Consumer Services industry average of roughly 16.8x and the peer group average of around 21.9x. On the surface, that discount suggests the market is still cautious about the company, despite its strong profitability and cash generation.
Simply Wall St also estimates a Fair Ratio of 15.5x for Perdoceo, which is the PE that might be expected given its earnings growth outlook, margins, industry positioning, market cap and risk profile. This company specific Fair Ratio is more informative than a simple comparison with peers or sector averages because it adjusts for the factors that can drive sustainable valuation. With the shares trading at 11.9x versus a Fair Ratio of 15.5x, the multiple analysis indicates that Perdoceo appears undervalued on an earnings basis.
Result: UNDERVALUED
NasdaqGS:PRDO PE Ratio as at Dec 2025
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1446 companies where insiders are betting big on explosive growth.
Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. These are simple stories that investors create on Simply Wall St’s Community page to connect their view of a company’s future revenues, earnings and margins to a financial forecast and, ultimately, to a fair value that can be compared with today’s share price to decide whether to buy or sell. Each Narrative updates dynamically as new news or earnings arrive. For Perdoceo Education, one investor might build a bullish Narrative around sustained high enrollment growth, stable regulation and improving margins that supports a fair value near the upper end of current estimates (around $42 per share). Another might craft a more cautious Narrative that assumes slower organic growth, rising student acquisition costs and regulatory headwinds, leading to a lower fair value closer to the bottom of the range. The power of the tool lies in how easy it is for you to customize these assumptions, see how the story flows through to the numbers and then track how your Narrative evolves as the facts change.
Do you think there’s more to the story for Perdoceo Education? Head over to our Community to see what others are saying!
NasdaqGS:PRDO 1-Year Stock Price Chart
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include PRDO.
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