Head-To-Head Contrast: Japan Tob (OTCMKTS:JAPAY) versus Perdoceo Education (NASDAQ:PRDO)

Perdoceo Education (NASDAQ:PRDO) and Japan Tob (OTCMKTS:JAPAY) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, dividends, profitability, risk and valuation.

Risk and Volatility

Perdoceo Education has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, Japan Tob has a beta of 0.28, suggesting that its stock price is 72% less volatile than the S&P 500.

Profitability

This table compares Perdoceo Education and Japan Tob’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Perdoceo Education	20.62%	18.93%	14.66%
Japan Tob	N/A	N/A	N/A

Valuation and Earnings

This table compares Perdoceo Education and Japan Tob”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Perdoceo Education	$846.10 million	2.03	$159.91 million	$2.84	9.66
Japan Tob	$23.20 billion	2.33	$3.42 billion	$1.37	11.10

Japan Tob has higher revenue and earnings than Perdoceo Education. Perdoceo Education is trading at a lower price-to-earnings ratio than Japan Tob, indicating that it is currently the more affordable of the two stocks.

Dividends

Perdoceo Education pays an annual dividend of $0.68 per share and has a dividend yield of 2.5%. Japan Tob pays an annual dividend of $0.53 per share and has a dividend yield of 3.5%. Perdoceo Education pays out 23.9% of its earnings in the form of a dividend. Japan Tob pays out 38.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Perdoceo Education has increased its dividend for 1 consecutive years.

Insider and Institutional Ownership

93.5% of Perdoceo Education shares are owned by institutional investors. 1.5% of Perdoceo Education shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and price targets for Perdoceo Education and Japan Tob, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Perdoceo Education	0	1	2	0	2.67
Japan Tob	1	0	1	1	2.67

Perdoceo Education currently has a consensus target price of $44.00, indicating a potential upside of 60.35%. Japan Tob has a consensus target price of $17.00, indicating a potential upside of 11.77%. Given Perdoceo Education’s higher possible upside, equities analysts clearly believe Perdoceo Education is more favorable than Japan Tob.

Summary

Perdoceo Education beats Japan Tob on 11 of the 16 factors compared between the two stocks.

About Perdoceo Education

Perdoceo Education Corporation provides postsecondary education through online, campus-based, and blended learning programs in the United States. It operates in two segments, Colorado Technical University and The American InterContinental University System. The Colorado Technical University segment offers academic programs, such as business and management, nursing, healthcare management, computer science, engineering, information systems and technology, project management, cybersecurity, and criminal justice. The American InterContinental University System segment provides academic programs, including business studies, information technologies, education, and health sciences. The company also offers non-degree and professional development programs. In addition, it operates intellipath, a learning platform used to educate students; and a mobile application and two-way messaging platform. The company was formerly known as Career Education Corporation and changed its name to Perdoceo Education Corporation in January 2020. Perdoceo Education Corporation was incorporated in 1994 and is headquartered in Schaumburg, Illinois.

About Japan Tob

Japan Tobacco Inc., a tobacco company, manufactures and sells tobacco products, pharmaceuticals, and processed foods in Japan and internationally. The company operates through three segments: Tobacco Business, Pharmaceutical, and Processed Food. It offers tobacco products, such as cigarettes, heat-not-burn tobacco products, E-vapor products, fine cut tobacco products, cigars, pipes, smokeless tobacco products, and hookah and kretek products. The company also provides reduced-risk products, including infused tobacco capsules and heated tobacco sticks. In addition, it researches and develops, manufactures, and sells prescription drugs for the therapeutic areas, such as cardiovascular, kidney and metabolism, immunity/inflammation, and central nervous system. Further, the company provides frozen and room-temperature products, such as frozen udon noodles, packed rice, and frozen okonomiyaki; bakery products; and seasonings, including yeast extracts, assembled, kelp and bonito extracts, and oyster sauces. It offers its products under the Winston, Camel, MEVIUS, and LD brands. Japan Tobacco Inc. was incorporated in 1985 and is headquartered in Tokyo, Japan.