Kip Mcgrath Education Centres Ltd (KME) fair value: what the stock is really worth
As of Oct 29, 2026: fair value (intrinsic value) of Kip Mcgrath Education Centres Ltd stock A$1.06, price A$0.70, upside +52.5%, quality 85 out of 100. Rating: strongly undervalued. Calculated from audited financials with 26 valuation models and 37 quality factors, updated daily.
Fair value 30%+ above price?Yes
Quality 50+?Yes
In an uptrend?Yes
Meets all three buy rules
Keep an eye on it?Free in your watchlist: 5 stocks without an account, 10 with oneYes, for free
Kip McGrath Education Centres Limited provides tutoring services in Australasia, Europe, the United States, and internationally. The company provides tutoring services for english and maths skills to primary and secondary students; and in-person and online tutoring services.
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It sells and services to franchise networks in the education field. Kip McGrath Education Centres Limited was founded in 1976 and is headquartered in Sydney, Australia..
Stock analysis
Kip Mcgrath Education Centres Ltd (KME) currently trades at A$0.6950, while our model-based Fair Value estimate is A$1.06, implying the stock looks roughly 34.4% undervalued today.
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Valuation
Bull case: the DCF Models group reads highest at a median of A$1.98 per share, and 18 of the 26 models we run sit above the A$0.6950 price.
Bear case: the Dividend Discount group reads lowest at A$0.2800, and 8 of the 26 models stay below the price. Data coverage for this calculation is low.
Scenario range: A$0.7900 (bear) to A$1.32 (bull), the price of A$0.6950 sits below it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.
Quality & growth
The Quality Score stands at 85/100 (high quality), in the Consumer Defensive sector.
Mixed Growth: Revenue is growing, but margins or cash flow do not fully confirm the trend.
Kip Mcgrath Education Centres Ltd reported revenue of A$30.0M in FY2026 versus A$24.6M in FY2022, a compound +5.0%/yr. Reported net income was A$2.5M in FY2026, compounding +7.7%/yr from FY2022.
Key figures
Market cap A$37.5M (≈ $26.5M) Micro · P/E ratio 17.4 · P/S ratio 1.30 · EPS (TTM) A$0.0400 · Dividend yield 2.9% · Net margin 8.4% · Return on equity 12.9% · Return on assets (EBIT) 11.9%.
Competitive moat
Our AI-assisted moat analysis scores the competitive advantage at 48 out of 100 (low confidence).
What moves the price
The share trades about 8% below its 52-week high and 70% above its 52-week low, currently above its 200-day average.
For context, the median of 10 Consumer Defensive peers we cover trades at 12% fair-value upside, at 53%, KME screens cheaper than that median.
Fair Value models
BearA$0.7900Fair Value A$1.06BullA$1.32
Price A$0.6950 · Upside +52.5%
Model ⓘEach model values the company its own way (discounted cash flow, earnings, assets, dividends). The fair value above starts from their evidence-weighted blend, not from a single model. In cyclical trough or peak years, after dilution or a stock split it is adjusted afterwards, so it can sit above or below the models. Based on fiscal year 2026 figures (about 4 months old). Earnings retained since then (A$0.0066 per share) are deliberately not added.Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target. If a model's bull case is above four times its base value, the table shows that limit with a > sign (like the overall Bull above): beyond it no assumption holds.Coverage ⓘCoverage = how well-backed THIS model's estimate is for this stock (0–100): how complete and reliable its input data are, and how well the model fits the company. The final Fair Value is an evidence-weighted blend, so better-evidenced models count more. Green ≥70, amber 50–69, grey below 50.
Growth Quality ⓘGrowth is valuable only when reinvestment earns attractive returns (Aswath Damodaran): sustainable growth depends on return on capital, reinvestment and efficiency. Basis: total company revenue over the periods shown on the cards (3Y/5Y/all years), not per share, so a merger can show up as a growth jump; per-share earnings growth is in the value-creation card.78/100
Revenue is growing, but margins or cash flow do not fully confirm the trend.
Revenue growth 1 year
−4.5%
Revenue growth 3 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+4.0%
Revenue growth 5 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+9.3%
Start year 2021 (pandemic). Over 10 years: +7.5% a year
Revenue growth 24 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+12.4%
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’19
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What shareholders gained per year (last 5 years) (mathematically smoothed) ⓘWhat the business itself delivers per year: earnings growth per share plus the dividend yield. This is what you get IF the market keeps valuing the stock the same way: it contains no assumption about the market changing its mind. Computed per share, so buybacks count and a merger does not pass as growth. For a company that pays no dividend it is pure earnings growth per share. Period: earnings growth per share as CAGR over the last 5 reported fiscal years (annual statements), plus the current dividend yield. The start value is the median of the three years around the start, so a single crisis year (a pandemic or a write-down) does not distort the rate. Smoothed = median of all growth paths between the years of the window (trend line on the logarithm of earnings per share): a single extreme year cannot distort the rate. The reported figure stays in the tooltip.
+7.2%
Earnings growth per share plus dividend.
Earnings per share, growth per year+4.3%
Dividend (yield on the price)2.9%
Pace: 5 vs 10 years ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.7.4% vs 6.1%, steady
Profit margin 2021 to 2026 ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.10% → 12%
2026 sits 71% above its own trend. The rate follows the median trend of the last 5 years, not that single year.
Pace: the 5-year rate starts in 2021 (pandemic)
Growth Forecast
Little optimism in the price
The price assumes less growth than the company has delivered so far.
What the price assumes ⓘThis turns our valuation around: instead of asking what the share is worth, it asks what growth the current price requires. It uses the cash the company keeps after all spending (free cash flow), the same discount rate as our models, five years of growth, then slowing evenly to 2 % a year by year ten. Compared with the analysts' sales forecasts extended to the same five years (at least three analysts, for context only, it does not enter the Fair Value): within 3 percentage points counts as "in line" (amber), below that little optimism (green), above that a lot of optimism (red).
−19.1%
The company could shrink this much every year for the next five years and today's price would still be justified.
What forecasts expect
n/a
No analyst forecast available.
After inflation (Australia: IMF forecast 3.0% a year to 2030, 2.9% from 2016 to 2025) that is about −21.5% a year for the price.
Compare Kip Mcgrath Education Centres Ltd with another stock
Price, fair value, quality and upside side by side.
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Peer GroupⓘHow this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.Education & Training Services · 118 stocks
Beats the industry median on 9/14 measures
Overall it ranks above its industry peers.
Valuation
Quality Score85 · Top 25%
Fair Value upside+46.2% · Above median
Profitability
Return on equity (12 months)12.9% · Above median
Return on assets9.4% · Top 25%
Net margin (12 months)8.4% · Above median
Operating margin (12 months)9.3% · Below median
Growth and dividend
Revenue growth (quarter YoY)1.6% · Below median
Dividend yield (12 months)2.9% · Above median
Balance sheet
Debt / equity0.02× · Below median
Valuation Multiplesvs Education & Training Services median · lower = cheaper
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Is Kip Mcgrath Education Centres Ltd (KME) overvalued or undervalued?
As of Oct 23, 2026, our model estimates a fair value of A$1.06 versus a price of A$0.6950, about +53% upside (undervalued).
What is the fair value of KME?
Our model-based fair value for Kip Mcgrath Education Centres Ltd is A$1.06 (as of Oct 23, 2026), built from audited fundamentals. The current price: A$0.6950.
What is the quality score of KME?
Kip Mcgrath Education Centres Ltd has a Quality Score of 85/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for Kip Mcgrath Education Centres Ltd (KME)?
Our model-based price target is the fair value of A$1.06 (as of Oct 23, 2026) from 26 valuation models. Cautious scenario A$0.7900, optimistic scenario A$1.32. It is a calculation from audited fundamentals, not an analyst target.
What is the Kip Mcgrath Education Centres Ltd stock forecast for 2026?
Our models put fair value at A$1.06, about +53% upside versus a price of A$0.6950 (undervalued). Cautious scenario A$0.7900, optimistic scenario A$1.32. The calculation is refreshed regularly with new filings.
What is the revenue of Kip Mcgrath Education Centres Ltd (KME)?
Kip Mcgrath Education Centres Ltd reported trailing-twelve-month revenue of about A$30.1M (latest available figure, as of Oct 23, 2026).
Does Kip Mcgrath Education Centres Ltd pay a dividend?
Kip Mcgrath Education Centres Ltd currently shows a dividend yield of 2.88% relative to its recent price (as of Oct 23, 2026).
What growth is priced into Kip Mcgrath Education Centres Ltd (KME)?
For today's price to be fair in a discounted-cash-flow model, Kip Mcgrath Education Centres Ltd would have to grow free cash flow by -19.1 % per year for five years (discount rate 8.3 %, then slowing evenly to 2 % perpetual growth by year ten). Over the last 5 years revenue grew +9.3 % per year. As of Oct 23, 2026.
What discount rate (WACC) does the fair value of KME use?
Our models discount Kip Mcgrath Education Centres Ltd at 8.3 %: a base by market capitalisation (nano), damped by beta 0.47, country premium for Australia. The same rate applies in all 26 models.
What is a reverse DCF?
A reverse DCF turns the usual calculation around. Instead of deriving a value from assumptions, it takes today's price as given and asks: what free-cash-flow growth would a company have to deliver for exactly this price to be fair? The result is not a forecast but the expectation already priced in. For Kip Mcgrath Education Centres Ltd that is -19.1 % per year a year over ten years, using the same discount rate (8.3 %) and the same formula as our fair value.
How much growth has Kip Mcgrath Education Centres Ltd (KME) delivered so far?
Over the past 5 years revenue at Kip Mcgrath Education Centres Ltd grew +9.3 % a year. The price currently implies -19.1 % per year free-cash-flow growth a year. Comparing the two shows how much confidence is in the price: if it demands more than has been delivered, the business has to accelerate for the maths to work.
How fast is the sector of Kip Mcgrath Education Centres Ltd (KME) growing?
The median revenue growth in the sector is +4.7 % a year. That is the yardstick for the growth priced into Kip Mcgrath Education Centres Ltd (-19.1 % per year a year): it shows whether the expectation is within the usual range or beyond it.
What is the free cash flow yield of Kip Mcgrath Education Centres Ltd (KME)?
The free-cash-flow yield on the price is 18.16 %: that much free cash flow Kip Mcgrath Education Centres Ltd produces per unit of market value. When it exceeds the discount rate of our models (8.3 %), the business already earns more than its cost of capital demands, and the price needs little additional growth.
What is the intrinsic value of Kip Mcgrath Education Centres Ltd (KME)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For Kip Mcgrath Education Centres Ltd it is A$1.06 per share (as of Oct 23, 2026), against a price of A$0.6950. It is the blended result of 26 valuation models (cash flow, earnings, asset, dividend).
Is Kip Mcgrath Education Centres Ltd stock overvalued or undervalued in 2026?
As of Oct 23, 2026, KME trades below its calculated fair value: price A$0.6950, fair value A$1.06, a gap of about +53% (undervalued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of KME?
No. The price is what the market pays today (A$0.6950); the fair value is what the company's own numbers justify (A$1.06). For Kip Mcgrath Education Centres Ltd the two are A$0.3650 per share apart. That gap is exactly why we show both numbers side by side.
How much is Kip Mcgrath Education Centres Ltd worth?
The market values Kip Mcgrath Education Centres Ltd at about A$37.5M (market capitalisation, as of Oct 23, 2026). Per share that is A$0.6950; our models calculate a fair value of A$1.06 per share.
What do the bullish and bearish scenarios say about KME?
Our models span a range for Kip Mcgrath Education Centres Ltd: cautious scenario A$0.7900, base A$1.06, optimistic A$1.32 per share (as of Oct 23, 2026, price A$0.6950). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of KME?
Kip Mcgrath Education Centres Ltd trades at a price-to-earnings ratio of 17.4 (as of Oct 23, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of A$1.06 is built from several models across several years. Other multiples: P/B 2.2, P/S 1.3, EV/EBITDA 8.4.
How solid is the balance sheet of Kip Mcgrath Education Centres Ltd (KME)?
Balance-sheet figures for Kip Mcgrath Education Centres Ltd (as of Oct 23, 2026): return on equity 12.9%, debt of 0.02 per unit of equity. They feed the Quality Score of 85/100, which measures business quality independently of the share price.
How far is KME from its 52-week high?
Kip Mcgrath Education Centres Ltd trades at A$0.6950, about 8% below its 52-week high of A$0.7550 and 70% above the low of A$0.4100 (as of Oct 29, 2026). Distance from the high says nothing about value: that is what the fair value of A$1.06 is for.
Which stocks are comparable to Kip Mcgrath Education Centres Ltd?
From the same area (Consumer Defensive) we also value New Oriental Education & Technology Group, Laureate Education, Inc, Covista Inc, Grand Canyon Education, Inc, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is Kip Mcgrath Education Centres Ltd stock attractive at the current price?
The data as of Oct 23, 2026: price A$0.6950, calculated fair value A$1.06 (+53%), Quality Score 85/100, from 26 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of KME calculated?
We run Kip Mcgrath Education Centres Ltd through 26 models from four families: discounted cash flow, earnings models, asset and balance-sheet models, and dividend models. Every model gets the same audited fundamentals; the result is the weighted average of A$1.06, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 13.4 % above its aggregate fair value. Kip Mcgrath Education Centres Ltd currently trades 34 % below its own fair value, and the market average says nothing about that. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on is it worth investing now.
What is the share price of Kip Mcgrath Education Centres Ltd (KME)?
The closing price on Oct 29, 2026 was A$0.6950. Our model-based fair value is A$1.06, about +53% upside (undervalued). We carry closing prices from our data provider, not a live tick.
What should I pay attention to with Kip Mcgrath Education Centres Ltd right now?
The rarer combination: high quality (85/100) AND below fair value. That earns a closer look rather than a quick verdict. The price is below even our cautious bear case (A$0.7900). The market is more pessimistic than our downside scenario. The large gap to fair value rests on thin data (low evidence): fewer applicable models and a shorter history. Read it with extra caution.
Where does the earnings growth of Kip Mcgrath Education Centres Ltd (KME) come from?
Earnings per share at Kip Mcgrath Education Centres Ltd grew +2.8 % a year from 2015 to 2026. Broken into its drivers: revenue per share +6.0 %, EBIT margin −2.6 %, tax rate +0.2 %, residual (interest, one-offs) −0.7 %. The four rates multiply to the earnings growth rate, they do not add up. Start and end are three-year averages so a single exceptional year does not distort the result.
Key figures of Kip Mcgrath Education Centres Ltd
How large is the market capitalisation of Kip Mcgrath Education Centres Ltd (KME)?
The market capitalisation of Kip Mcgrath Education Centres Ltd is A$37.5M (≈ $26.5M). The stock-market value of the whole company: share price times number of shares. It is what the market asks for the entire business today.
What is the P/S ratio of Kip Mcgrath Education Centres Ltd (KME)?
The price-to-sales ratio of Kip Mcgrath Education Centres Ltd is 1.30 (last twelve months). Price to sales: market value relative to yearly revenue. Useful when profit is thin or distorted.
What are the earnings per share of Kip Mcgrath Education Centres Ltd (KME)?
Earnings per share at Kip Mcgrath Education Centres Ltd are A$0.0400 (price ÷ EPS = P/E 17.4). Earnings per share over the last twelve months: total profit spread across every single share.
What is the dividend yield of Kip Mcgrath Education Centres Ltd (KME)?
The dividend yield of Kip Mcgrath Education Centres Ltd is 2.9% (payout 50.0%). Yearly dividend relative to the share price. 3% pays 3 per 100 invested. Below: how much of profit is used for it.
What is the net margin of Kip Mcgrath Education Centres Ltd (KME)?
The net margin of Kip Mcgrath Education Centres Ltd is 8.4% (last twelve months). How much of every unit of revenue ends up as profit. 10% means 10 cents of profit per dollar of sales.
What is the return on equity of Kip Mcgrath Education Centres Ltd (KME)?
The return on equity (ROE) of Kip Mcgrath Education Centres Ltd is 12.9% (last twelve months). Profit relative to shareholders' equity, how efficiently the company works with its owners' money.
What is the EBIT return on assets of Kip Mcgrath Education Centres Ltd (KME)?
On an EBIT basis the return on assets of Kip Mcgrath Education Centres Ltd is 11.9% (avg 5y). Operating profit (EBIT) relative to everything the company owns, as a multi-year average. It describes the business model rather than one good or bad year.
What is the operating margin of Kip Mcgrath Education Centres Ltd (KME)?
The operating margin of Kip Mcgrath Education Centres Ltd is 9.3% (last twelve months). Profit from the core business (before interest and taxes) relative to revenue.
How fast is revenue growing at Kip Mcgrath Education Centres Ltd (KME)?
Revenue at Kip Mcgrath Education Centres Ltd is growing +1.6% versus a year earlier (3y avg +4.0%). How much revenue grew versus a year earlier (YoY). The 3-year average next to it puts the single year in context.
How fast are earnings growing at Kip Mcgrath Education Centres Ltd (KME)?
Earnings per share at Kip Mcgrath Education Centres Ltd are growing +188% versus a year earlier. How much earnings per share grew versus a year earlier.
How much net cash does Kip Mcgrath Education Centres Ltd (KME) hold?
Kip Mcgrath Education Centres Ltd holds more cash than debt, A$4.7M net (fiscal year 2026). The company holds more cash than debt, a safety cushion.
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Thin data
Oct 23, 2026