ASX 200 share IDP Education Ltd (ASX: IEL) has seen a 40% drop in its share price over the past year, closing at $16.05 on Friday. This decline stands in contrast to the 8.55% gain seen in the S&P/ASX 200 Index (ASX: XJO) over the same period. Despite this, fund manager Prasad Patkar believes that IDP Education offers great value for investors.
Patkar, head of investments at Platypus Asset Management, praises IDP Education as the most undervalued stock in their portfolio. He attributes the current low valuation to short-term regulatory challenges but remains optimistic about the company’s competitive strength in the next one to two years.
IDP Education operates as an international education organization, assisting foreign students in enrolling in courses in Australia, New Zealand, the United States, and the United Kingdom. The company’s shares are held in Platypus’s Australian Equities Fund, known for its high-conviction growth strategy and ESG analysis of selected stocks.
The fund also has a significant overweight position in consumer discretionary stocks, including IDP Education. Despite concerns about high inflation and interest rates, Patkar believes in the resilience and defensive properties of companies like ARB Corporation Ltd (ASX: ARB), Lovisa Holdings Ltd (ASX: LOV), Aristocrat Leisure Limited (ASX: ALL), and Domino’s Pizza Enterprises Ltd (ASX: DMP) to withstand fluctuations in consumer spending.
Overall, IDP Education stands out as a promising investment opportunity due to its current undervaluation and potential for future growth in the international education sector.