After studying the pri vate-education sector on the JSE, investors may want to raise their hands to ask two key questions. First, why is there such a huge difference in the market ratings accorded to the two sector stalwarts, Curro Holdings and AdvTech? Second, why — with such rich earnings multiples being accorded to Curro (and, to a lesser extent, AdvTech) — are there not more private-education contenders graduating onto the JSE? The respective market ratings of Curro and AdvTech provide plenty of food for thought, especially as both counters are firmly in a growth groove. Curro holds a market capitalisation of R16.5bn against AdvTech’s R8.8bn. AdvTech has a meaningful presence in the school and tertiary education sectors. It is about twice the size of Curro in terms of turnover and operating profit. So a simple deduction would be that the market expects Curro to easily outstrip AdvTech in terms of pace of earnings growth. This theory is supported by the respective market ratings,...
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