I think it is fair to say that the Australian education market doesn't get a lot of attention from investors.
But with education exports growing to $21 billion in 2016/17 according to the Australian Bureau of Statistics, now might be a good time to take a closer look at the options available in the industry.
Should you buy these three education shares?
Idp Education Ltd (ASX: IEL)
Australia's largest student agent company and an owner of the IELTS test has seen its share price rise a massive 48% so far this year. Investors were clearly impressed that the company recently delivered a 22% increase in full-year earnings before interest and tax on a constant currency basis. While I think IDP Education is in a strong position to continue this strong growth, I would wait for a better entry point. At present its shares are changing hands at 36x trailing earnings, which I think limits its upside potential.
Navitas Limited (ASX: NVT)
The shares of this provider of educational services to domestic and overseas students have fallen around 13% since the turn of the year. A good portion of this decline came after its full-year results disappointed the market. In FY 2017 Navitas posted a 10.8% decline in net profit after tax from ordinary activities to $80.3 million. Unfortunately, I'm not overly bullish on its prospects in FY 2018 due to the impact the reduction of its AMEP delivery centres will have on the business.
Schrole Operations Ltd (ASX: SCL)
Schrole provides schools both at home and abroad with innovative, technology-based recruitment platforms and consulting service solutions that enable schools to address current staffing and recruitment challenges. At the last count, the company's products were being used in 207 international and domestic schools across 32 countries. The company is due to land on the ASX boards in the near future following an oversubscribed prospectus share offer. I think it has a lot of potential and is certainly another Australian tech share to watch.
