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In January 2024, InvestingPro’s Fair Value models identified a significant mispricing in (NASDAQ:LAUR) shares, highlighting an opportunity that would ultimately deliver a 47% return for investors. This success story demonstrates the power of comprehensive fair value analysis in identifying undervalued stocks before the market recognizes their true worth. Investors seeking similar opportunities can explore today’s most promising candidates on our Most undervalued list.
Laureate Education, a leading international network of higher education institutions, operates primarily in Mexico and Peru. When InvestingPro’s Fair Value model flagged the stock at $13.00, the company was showing strong fundamentals with annual revenue of $1.48 billion and EBITDA of $411.5 million, yet traded at a significant discount to its intrinsic value.
The Fair Value analysis proved remarkably accurate as LAUR shares steadily appreciated over the following 15 months, reaching $19.37 by April 2025. This 47% gain was supported by impressive fundamental improvements, including a 5.5% increase in revenue to $1.57 billion and a 182% surge in earnings per share to $1.93.
Recent developments have validated InvestingPro’s initial thesis. The company reported strong Q4 2024 results, leading to multiple guidance upgrades. Management’s confidence was further demonstrated through a $100 million stock buyback program. Additionally, the company has consistently hit new 52-week highs, with analysts maintaining positive coverage, including multiple "Outperform" ratings.
InvestingPro’s Fair Value methodology combines multiple valuation approaches, including discounted cash flow analysis, peer comparisons, and analyst estimates, to determine a stock’s intrinsic value. This comprehensive approach helps investors identify opportunities where market prices significantly deviate from fundamental worth, as demonstrated in this case with Laureate Education.
The success of this Fair Value analysis exemplifies the advantage of data-driven investment decisions. InvestingPro continues to identify similar opportunities across markets, combining fundamental analysis with technical indicators to help investors make more informed decisions. With features like real-time Fair Value alerts, comprehensive financial analysis, and proprietary indicators, InvestingPro subscribers gain access to professional-grade tools that can help identify the next potential market-beating opportunity.