UPDATE: Stifel Nicolaus Reiterates Buy Rating, Raises PT on Grand Canyon Education on Multiple Positive Factors

In a report published Tuesday, Stifel Nicolaus analyst Robert Craig reiterated a Buy rating on Grand Canyon Education LOPE, and raised the price target from $31.00 to $37.00. In the report, Stifel Nicolaus noted, “Given the growth and profitability characteristics of the business we are maintaining our Buy rating and raising our target price to $37 (18x our FY14 EPS estimate, 8x EV/EBITDA, and a 1.3x PE/Growth ‘14 multiple). The company has been a strong performer given its continued growth in a challenging market and the stock has performed as well, up 41% YTD (vs. the S&P500 up 15%). However despite the gains, valuation appears low (in our opinion) especially when valued as a growth stock and not discounted by its position in an out-of favor sector - with a 16x PE and 7x EV/EBITDA multiple on our 2014 estimates. The company is arguably the current best of breed, and still trades at a discount to the sector's overall average PE of 18.9x CY14 estimates, and LOPE trades at a discount to the overall market on a PE and PE/Growth basis (LOPE at 1.2x vs. S&P500 at 1.7x). Likewise we are keeping the stock as a Stifel Select List pick.” Grand Canyon Education closed on Monday at $32.62.