Core Viewpoint - Adtalem Global Education (ATGE) is currently identified as a strong buy with attractive valuation metrics, indicating it may be undervalued in the market [2][3]. Valuation Metrics - ATGE holds a Zacks Rank of 1 (Strong Buy) and a Value grade of A, with a current P/E ratio of 11.72, significantly lower than the industry average P/E of 21.51 [2]. - The stock's Forward P/E has fluctuated between 7.90 and 13.56 over the past year, with a median of 9.98 [2]. - ATGE has a PEG ratio of 0.78, compared to the industry average PEG of 1.27, indicating a favorable valuation relative to expected earnings growth [2]. - Over the past 52 weeks, ATGE's PEG has ranged from 0.53 to 0.90, with a median of 0.67 [2]. Price-to-Book Ratio - ATGE's P/B ratio stands at 1.88, which is attractive compared to the industry average P/B of 3.71 [3]. - The P/B ratio has varied between 0.98 and 1.88 over the past 12 months, with a median of 1.36 [3]. Investment Outlook - The combination of these valuation metrics suggests that Adtalem Global Education is likely undervalued, making it a strong candidate for value investors [3].

The 15-month bull run of U.S. stock markets suffered a surprise setback in April. We believe that April’s meltdown is nothing but a bull market correction and this time a welcome one as Wall Street has rebounded in May.The Department of Labor reported that the U.S. economy added 175,000 jobs in April, missing the consensus estimate of 200,000. Job additions in March were revised upward by 12,000 while those in February were revised downward by 34,000.The unemployment rate increased to 3.9% in April, compare ...

Investors with an interest in Schools stocks have likely encountered both Adtalem Global Education (ATGE) and Lincoln Educational Services Corporation (LINC) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estim ...

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Core Insights - The article emphasizes the importance of cash flow as a critical indicator of a company's financial health and growth potential, suggesting that companies with strong cash-generating capabilities are more resilient in uncertain economic conditions [1][2]. Group 1: Importance of Cash Flow - Cash is described as the lifeblood of any business, providing strength, vitality, and flexibility for investment decisions and growth [1]. - Positive cash flow indicates an increase in liquid assets, enabling a company to meet obligations, reinvest, and return wealth to shareholders, while negative cash flow suggests declining liquidity [2]. - A company must not only have positive cash flow but also increasing cash flow to demonstrate management efficiency and reduced dependency on external financing [3]. Group 2: Screening Parameters for Stock Selection - Stocks were screened for those whose latest reported quarter cash flow was at least equal to or greater than the 5-year average cash flow per common share, indicating a positive trend [4]. - Additional criteria included a Zacks Rank of 1 (Strong Buy), an average broker rating of 1, a current price of at least $5, and a VGM Score of B or better [4]. Group 3: Selected Stocks - **Adtalem Global Education Inc. (ATGE)**: A leading healthcare education provider with a projected fiscal 2024 sales growth of 8.3% and EPS growth of 16.4%, holding a VGM Score of A [5]. - **HNI Corporation (HNI)**: A global provider of office furniture with a revised EPS estimate of $3.10 for 2024, reflecting a 5.8% upward revision and a VGM Score of A [6]. - **Diebold Nixdorf, Incorporated (DBD)**: Engaged in banking and retail automation, with a 47% upward revision in 2024 earnings estimates and a VGM Score of A [6]. - **GigaCloud Technology Inc. (GCT)**: A pioneer in B2B e-commerce solutions, with a 9.1% increase in 2024 EPS estimates to $3.25 and a VGM Score of A [7].

Investors interested in Consumer Discretionary stocks should always be looking to find the best-performing companies in the group. Has Adtalem Global Education (ATGE) been one of those stocks this year? A quick glance at the company's year-to-date performance in comparison to the rest of the Consumer Discretionary sector should help us answer this question.Adtalem Global Education is a member of our Consumer Discretionary group, which includes 285 different companies and currently sits at #9 in the Zacks Se ...

Most of us have heard the dictum "the trend is your friend." And this is undeniably the key to success when it comes to short-term investing or trading. But it isn't easy to ensure the sustainability of a trend and profit from it.Often, the direction of a stock's price movement reverses quickly after taking a position in it, making investors incur a short-term capital loss. So, it's important to ensure that there are enough factors -- such as sound fundamentals, positive earnings estimate revisions, etc. -- ...

Core Insights - Adtalem Global Education (ATGE) is a leader in post-secondary education and a significant provider of talent to the healthcare industry, reporting robust revenue growth over the past three years [2][38] - For 3Q24, ATGE's revenue grew 11.8% year-over-year to approximately $412.7 million, driven by strong enrolment and tuition rates [28][38] - The healthcare industry is facing significant labour shortages, which are expected to worsen, impacting growth targets for healthcare companies [32][34][38] Financial Performance - Total revenue for ATGE was $899.2 million in 2021, increasing to $1.381 billion in 2022 due to the acquisition of Walden, and further rising to $1.450 billion in 2023 [26] - The adjusted operating income margin improved from 17.4% in 2021 to 19.8% in 2023, despite a drop in GAAP operating income margin in 2022 [26][27] - Adjusted net income margin remained stable, reporting 12.49% in 2021, contracting to 11% in 2022, and expanding to 13.25% in 2023 [27] Segment Performance - In 3Q24, Chamberlain's revenue grew 13.8%, Walden's revenue increased by 13.3%, and Medical and Veterinary's revenue rose by 6.1% [28] - Total student enrolment increased by 7.8% year-over-year, with Chamberlain and Walden showing growth of 9% and 8.4%, respectively, while Medical and Veterinary saw a decline of 4.5% [28] Cost and Margin Analysis - The cost of educational services decreased from 44.9% to 42.5% of revenue, attributed to top-line growth and cost efficiencies [30] - Student services and administrative expenses fell from 39.2% to 38% of revenue, due to efficient marketing spending and reduced intangible amortisation expenses [30] - Adjusted EBITDA margin expanded from 23.30% to 25.90%, and adjusted net income margin increased from 13.97% to 14.38% [30] Industry Context - Labour shortages in the healthcare sector have been a top concern for hospital CEOs for three consecutive years, with about half indicating that these shortages will hinder growth targets over the next five years [32][38] - Current estimates suggest a shortage of 200,000 nurses, expected to rise to 400,000 by 2025, and a physician shortage of 60,000, projected to expand to 120,000 by 2034 [34] Valuation and Guidance - ATGE is trading at a P/E ratio of 13.39x, lower than the peers' median of 14.22x, reflecting its underperformance in growth outlook and profitability margins [36] - Management raised the FY2024 revenue guidance to between $1.56 billion and $1.58 billion, indicating confidence in future growth [36][38]

Third Quarter 2024 Earnings May 2, 2024 ©2024 Adtalem Global Education Inc. All rights reserved Safe FORWARD-LOOKING STATEMENTS ...

Financial Data and Key Metrics Changes - Total revenue for Q3 2024 was $413 million, an increase of 11.8% year-over-year, driven by a 7.8% growth in total enrollment [7][22] - Adjusted earnings per share reached $1.50, reflecting a 32.7% increase compared to the previous year [7][24] - Adjusted EBITDA was $107.1 million, up 24.6% year-over-year, resulting in an adjusted EBITDA margin of 25.9%, a 260 basis points increase from last year [22][24] Business Line Data and Key Metrics Changes - Chamberlain's revenue increased by 13.8% to $170.3 million, with total student enrollment up 9% year-over-year [24][25] - Walden's revenue grew by 13.3% to $150.6 million, with total student enrollment up 8.4% compared to the prior year [26] - The medical and veterinary segment saw revenue increase by 6.1% to $91.7 million, although total student enrollment decreased by 4.5% year-over-year [27] Market Data and Key Metrics Changes - Enrollment trends in the medical and veterinary segment improved sequentially, with a 300 basis points improvement from the last reported cycle [27][16] - Chamberlain's pre-licensure BSN online option saw triple-digit growth compared to last year, addressing critical nursing shortages [25][14] - Walden's "Believe and Achieve Scholarship" program has over 23,000 participants, reducing tuition costs by up to 25% for students who persist through their programs [15] Company Strategy and Development Direction - The company aims to establish itself as a national leader in post-secondary education and a key partner in U.S. healthcare, focusing on expanding access to high-quality academic programs [8][10] - The "Growth with Purpose" strategy emphasizes organic growth through operational excellence and transformational improvements across marketing, enrollment, persistence, pricing, and programs [11][19] - The company is committed to addressing healthcare workforce shortages and enhancing health equity through its educational offerings [19][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining revenue growth and operational leverage into the fourth quarter, raising fiscal year 2024 revenue guidance to $1.56 billion to $1.58 billion [11][30] - The company is closely monitoring FAFSA delays but currently sees no risks to upcoming enrollment cycles [35] - Management anticipates total enrollment in the medical segment to improve sequentially, with expectations for positive year-over-year growth in fiscal 2025 [39][52] Other Important Information - The company achieved a combined 98% first-time residency match rate for its medical schools, placing over 815 students into healthcare facilities [18] - Free cash flow for the fiscal year-to-date was $195 million, a $64 million increase year-over-year [28] - The company reduced outstanding letters of credit by $76.1 million during the third quarter, enhancing financial flexibility [29] Q&A Session Summary Question: How is the company addressing FAFSA delays for fall enrollment? - Management is monitoring the situation closely and currently sees no potential risks to upcoming enrollment cycles [35] Question: What is the outlook for FY '25 guidance? - Management believes the previously provided guidance of 4 to 6% growth is still a good proxy, with more specific guidance to be provided later [37] Question: When can the company expect growth in medical school enrollments? - Management expects total enrollment in the medical segment to improve sequentially, with potential for positive year-over-year growth early in fiscal 2025 [39] Question: How is the company balancing reinvestment and operational leverage? - Management prioritizes reinvesting in organic growth while also managing debt and returning capital to shareholders [42] Question: What are the growth drivers for Chamberlain and Walden? - Growth is driven by improved persistence rates and new enrollment growth, with expectations for continued growth in both institutions [45] Question: What initiatives are in place for medical schools to increase enrollment? - Management is focused on execution improvements and believes there is still a strong market opportunity for growth in medical school enrollments [52] Question: What is the status of the veterinary school regarding Department of Education regulations? - Management is engaged with the Department of Education to extend measurement periods for DVM programs and is confident in the program's ongoing viability [54]