STOCKWATCH | Stadio trades at a premium as investors bet on growth

Almost a decade after its listing on the JSE, Stadio Holdings is commanding a higher valuation on its earnings than its much larger listed education rival, Advtech.

Stadio, which was unbundled from the now-delisted education group Curro Holdings and listed in October 2017, now trades at about 32.65 times its earnings, compared with about 19.6 times for Advtech. Investors are therefore paying considerably more for each rand of Stadio’s earnings than they are for a rand of Advtech’s earnings.

According to Iress data, Stadio’s market valuation has almost tripled since listing, taking its market capitalisation to R10.6bn with a share price of R12.57 by Friday’s close. At R25.35bn, Advtech’s market capitalisation is more than double that of Stadio’s.

While the difference in how investors are pricing the education giants is striking because Advtech is a much larger company with a longer presence on the bourse, Stadio’s premium valuation does not necessarily mean that investors consider it a better company than Advtech.

The higher price-to-earnings ratio shows that investors have confidence in the company and expect stronger earnings growth in the future and are therefore prepared to pay more.

That raises questions about whether Stadio can continue delivering the growth needed to support the premium built into its share price. However, the group’s latest voluntary trading statement suggests earnings are still moving in the right direction.

For the six months to end-June, Stadio expects earnings per share (EPS) to increase by 11.5%-19.2%, while headline earnings per share (HEPS) are expected to rise 12.1%-19.8% to 23.2c-24.8c, it said on Friday . Core HEPS, which the group uses to measure underlying performance, are expected to increase 14.5%-22.2%.

Stadio’s valuation today is a significant change from where the company started on the JSE. The business has also changed.

Stadio listed with just 840 students, but by December 2025 that number had grown to 53,303 as the group expanded its campuses, qualifications, and distance-learning operations.

It has also become a larger and more profitable business. Revenue increased from R815m in 2019 to R1.84bn in 2025, while core headline earnings per share rose from 10.8c to 38.5c over the same period, according to its latest annual report.

The group now operates through Stadio Higher Education, Milpark Education and Afda. It has more than 100 accredited qualifications and is targeting 80,000 students by 2030, with a longer-term ambition of more than 100,000 students.

The expansion is important considering the valuation investors have placed on the company, as it shows that the high P/E ratio (32.65) is effectively a bet on the future. If earnings grow strongly, today’s high valuation can become easier to justify as the company makes more profit.

Stadio’s recent performance provides some context for the market’s expectations.