Core Viewpoint - Grand Canyon Education (LOPE) has received an upgrade to a Zacks Rank 1 (Strong Buy), indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][4][6]. Earnings Estimates and Stock Ratings - The Zacks rating system is primarily driven by changes in a company's earnings picture, with the Zacks Consensus Estimate reflecting EPS estimates from sell-side analysts [2][3]. - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [8][10]. Recent Performance of Grand Canyon Education - For the fiscal year ending December 2025, Grand Canyon Education is expected to earn $9.07 per share, which remains unchanged from the previous year, but the Zacks Consensus Estimate has increased by 3.7% over the past three months [9][11]. - The upgrade to Zacks Rank 1 places Grand Canyon Education in the top 5% of Zacks-covered stocks, suggesting potential for higher stock movement in the near term [11].

Financial Data and Key Metrics Changes - Service revenue for Q2 2025 was $247.5 million, an increase of $20 million or 8.8% compared to $227.5 million in Q2 2024 [24] - Operating income for Q2 2025 was $51.8 million with an operating margin of 20.9%, compared to $42.7 million and 18.8% in Q2 2024 [25] - Net income increased by 19.1% to $41.5 million in Q2 2025 from $34.9 million in Q2 2024 [25] Business Line Data and Key Metrics Changes - Online enrollment growth was 10.1%, with hybrid growth (excluding closed sites) at 15.4% [5][11] - Ground campus traditional student enrollments were down slightly year over year, but summer ground enrollment increased by 16% [7][8] - Hybrid campus enrollment increased by 14% year over year, with a 15.4% increase when excluding closed sites [11] Market Data and Key Metrics Changes - The number of high school graduates choosing the four or five-year baccalaureate path continues to decline, while interest in shorter certificate or trade programs is increasing [10] - There is a growing trend of students opting for fully online college programs, benefiting the company's online offerings [10] Company Strategy and Development Direction - The company plans to continue expanding its program offerings, including new nursing and occupational therapy programs [15][18] - The focus remains on maintaining competitive pricing and increasing retention levels to drive enrollment growth [6][8] - The company aims to accurately reflect the flexibility it provides to students across different age groups, targeting both traditional and non-traditional students [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about maintaining momentum in enrollment growth despite tougher comparisons in the second half of the year [7][32] - The regulatory environment is expected to have little to no impact on the company's partner programs, with a focus on workforce development [22][23] - The company anticipates continued growth in online and hybrid enrollments, with expectations for new enrollments in the mid to high single digits [32] Other Important Information - The company repurchased 259,271 shares at a cost of approximately $47.4 million, with $156.9 million remaining under the share repurchase authorization [28][29] - The effective tax rate for 2025 was 24.5%, down from 25.5% in 2024, primarily due to changes in state income taxes [27][28] Q&A Session Summary Question: What drove the accelerating enrollment growth in the quarter? - Management highlighted growth in teacher education and nursing programs, as well as an increase in students opting for online education [39][40] Question: What are the expectations regarding regulatory changes and competitive responses? - Management noted that while there have been competitive offers for traditional students, they have not seen the same level of aggressive offers as in previous years, which supports their enrollment growth [49][51] Question: What are the potential upside drivers for enrollment in the second half? - The company aims to exceed internal goals for new enrollments, which could provide upside potential despite tough comparisons [54]

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for Grand Canyon Education, Inc. for the period ended June 30, 2025, providing a quantitative overview of the company's financial performance and position [Consolidated Income Statements](index=4&type=section&id=Consolidated%20Income%20Statements) Service revenue grew to $247.5 million for the three months ended June 30, 2025, an 8.8% increase year-over-year, driven by higher partner enrollments, with net income rising 19.1% to $41.5 million Consolidated Income Statement Highlights (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Service Revenue** | $247,499 | $227,463 | +8.8% | $536,809 | $502,138 | +6.9% | | **Operating Income** | $51,789 | $42,719 | +21.2% | $139,812 | $127,197 | +9.9% | | **Net Income** | $41,546 | $34,878 | +19.1% | $113,164 | $102,888 | +10.0% | | **Diluted EPS** | $1.48 | $1.19 | +24.4% | $4.00 | $3.48 | +14.9% | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets stood at $1.021 billion, with cash and cash equivalents decreasing to $192.3 million, offset by a new investment balance of $181.6 million Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $192,278 | $324,623 | | **Investments** | $181,621 | $0 | | **Total current assets** | $422,481 | $419,976 | | **Total assets** | $1,021,007 | $1,018,425 | | **Total current liabilities** | $118,990 | $110,966 | | **Total liabilities** | $243,031 | $234,572 | | **Total stockholders' equity** | $777,976 | $783,853 | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash from operating activities was $191.6 million, while investing activities used $198.7 million and financing activities used $125.2 million, resulting in a net decrease in cash of $132.3 million Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $191,639 | $183,526 | | **Net cash used in investing activities** | $(198,748) | $(19,989) | | **Net cash used in financing activities** | $(125,236) | $(68,695) | | **Net (decrease) increase in cash** | $(132,345) | $94,842 | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the company's accounting policies and provide further information on financial statement items, including its business model, revenue recognition, investments, leases, legal contingencies, and share repurchase program - GCE provides education services to **20 university partners**, with its most significant partner being Grand Canyon University (GCU)[23](index=23&type=chunk)[24](index=24&type=chunk) - Revenue is generated through services agreements with university partners, where GCE receives a percentage of the partner's tuition and fee revenue, recognized over time as services are delivered[45](index=45&type=chunk)[46](index=46&type=chunk) - GCU accounted for **89.4% of total service revenue** for the six months ended June 30, 2025, indicating a significant concentration of credit risk[59](index=59&type=chunk) - The company is involved in several legal proceedings, including a False Claims Act lawsuit and matters related to GCU graduate program disclosures, for which it cannot reasonably estimate a range of loss and has not accrued any liability[85](index=85&type=chunk)[89](index=89&type=chunk)[91](index=91&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial results for the three and six months ended June 30, 2025, highlighting revenue growth driven by increased partner enrollments, improved operating margins, liquidity, capital resources, and the ongoing share repurchase program [Results of Operations](index=37&type=section&id=Results%20of%20Operations) For Q2 2025, revenue increased 8.8% to $247.5 million, driven by a 10.3% rise in partner enrollments, with all expense categories decreasing as a percentage of revenue, leading to a 19.1% increase in net income to $41.5 million Partner Enrollment Growth | Metric | June 30, 2025 | June 30, 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Total Partner Enrollments** | 117,283 | 106,307 | +10.3% | | **GCU Enrollments** | 113,435 | - | +10.5% | | **Off-campus Site Enrollments** | 4,990 | - | +14.0% | - For Q2 2025, revenue growth of **8.8%** was primarily driven by the increase in partner enrollments, while revenue per student decreased slightly due to contract modifications and student mix shifts[115](index=115&type=chunk) - Operating expenses as a percentage of revenue decreased in Q2 2025 compared to Q2 2024 across all categories, indicating improved operational efficiency and leverage[114](index=114&type=chunk) [Liquidity and Capital Resources](index=47&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity remains strong, with cash, cash equivalents, and investments totaling $373.9 million at June 30, 2025, with major uses of cash including investments and share repurchases Key Liquidity and Capital Metrics (Six Months Ended June 30, 2025) | Metric | Amount (in thousands) | | :--- | :--- | | **Cash provided by operating activities** | $191,639 | | **Capital expenditures** | $(17,561) | | **Net purchases of investments** | $(180,659) | | **Repurchase of common shares** | $(125,236) | | **Cash, cash equivalents and investments (End of Period)** | $373,899 | - The company repurchased **654,697 shares** for **$115.7 million** in the first six months of 2025[99](index=99&type=chunk)[153](index=153&type=chunk)[155](index=155&type=chunk) - As of June 30, 2025, **$183.9 million** remained available under the share repurchase authorization[99](index=99&type=chunk)[153](index=153&type=chunk)[155](index=155&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk associated with its investment portfolio, though management believes a 10% change in interest rates would not have a material impact on financial results - The company invests excess cash in money market instruments, corporate bonds, commercial paper, and other securities, exposing it to interest rate risk[157](index=157&type=chunk)[158](index=158&type=chunk) - Management believes a hypothetical **10% change in interest rates** would not materially impact the company's financial results[158](index=158&type=chunk) [Item 4. Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that the company's disclosure controls and procedures are effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of the end of the period[159](index=159&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[161](index=161&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 8 of the consolidated financial statements for information regarding material pending legal proceedings, including a False Claims Act matter and cases related to GCU graduate program disclosures - Information on material legal proceedings is incorporated by reference from Note 8 – Commitments and Contingencies in the financial statements[162](index=162&type=chunk) [Item 1A. Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) The company states that there have been no material changes to the risk factors previously disclosed in its Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - There were no material changes to the risk factors disclosed in the 2024 Form 10-K[163](index=163&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=30&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities and provided details on its share repurchase activity for the second quarter of 2025, with $183.9 million remaining available under the current authorization Share Repurchases in Q2 2025 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April 2025 | 113,162 | $172.33 | | May 2025 | 71,417 | $193.20 | | June 2025 | 74,692 | $188.52 | | **Total Q2** | **259,271** | **$182.74** | - As of June 30, 2025, **$183.9 million** remained available for future repurchases under the program authorized until March 1, 2026[165](index=165&type=chunk)[166](index=166&type=chunk) [Item 3. Defaults Upon Senior Securities](index=31&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) None reported - The company reported no defaults upon senior securities[168](index=168&type=chunk) [Item 4. Mine Safety Disclosures](index=31&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Not applicable - The company reported no mine safety disclosures[169](index=169&type=chunk) [Item 5. Other Information](index=31&type=section&id=Item%205.%20Other%20Information) The company reported that no director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the second quarter of 2025 - No director or officer adopted or terminated a Rule 10b5-1 trading plan during the three months ended June 30, 2025[170](index=170&type=chunk) [Item 6. Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and financial statements formatted in Inline XBRL - Exhibits filed include Sarbanes-Oxley Act certifications (31.1, 31.2, 32.1, 32.2) and financial data in Inline XBRL format (101, 104)[171](index=171&type=chunk)[172](index=172&type=chunk)

[Financial Highlights](index=2&type=section&id=Financial%20Highlights) GCE reported strong financial growth in Q2 and H1 2025, driven by a 10.3% increase in partner enrollments [Second Quarter 2025 Performance (Three Months Ended June 30, 2025)](index=2&type=section&id=Second%20Quarter%202025%20Performance%20(Three%20Months%20Ended%20June%2030%2C%202025)) In Q2 2025, GCE's service revenue increased by 8.8% year-over-year to $247.5 million, with operating income up 21.2% to $51.8 million and net income growing 19.1% to $41.5 million Q2 2025 Financial Performance | Financial Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Service Revenue | $247.5M | $227.5M | +8.8% | | Operating Income | $51.8M | $42.7M | +21.2% | | Net Income | $41.5M | $34.9M | +19.1% | | Diluted EPS | $1.48 | $1.19 | +24.4% | | Adjusted EBITDA | $67.4M | $58.5M | +15.2% | - The primary driver for revenue growth was a **10.3% increase in partner enrollments**, reaching **117,283 students** as of June 30, 2025[5](index=5&type=chunk) - GCU enrollments, the most significant partner, increased by **10.5% to 113,435**, with enrollments at off-campus classroom and laboratory sites growing by **14.0%**[5](index=5&type=chunk) - Operating margin improved to **20.9%** from **18.8%** year-over-year, positively impacted by contract modifications where GCE no longer reimburses partners for certain faculty costs[5](index=5&type=chunk) [First Half 2025 Performance (Six Months Ended June 30, 2025)](index=2&type=section&id=First%20Half%202025%20Performance%20(Six%20Months%20Ended%20June%2030%2C%202025)) For the first six months of 2025, service revenue grew 6.9% to $536.8 million, operating income increased 9.9% to $139.8 million, and net income rose 10.0% to $113.2 million H1 2025 Financial Performance | Financial Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Service Revenue | $536.8M | $502.1M | +6.9% | | Operating Income | $139.8M | $127.2M | +9.9% | | Net Income | $113.2M | $102.9M | +10.0% | | Diluted EPS | $4.00 | $3.48 | +14.9% | | Adjusted EBITDA | $169.4M | $157.1M | +7.8% | - Revenue growth was driven by a **10.3% increase in partner enrollments**, though revenue per student slightly decreased due to the 2024 leap year adding $1.5 million in revenue and certain contract modifications[4](index=4&type=chunk)[6](index=6&type=chunk) - The effective tax rate decreased to **22.7%** from **23.8%** in the prior year, primarily due to an increase in excess tax benefits[8](index=8&type=chunk) [Liquidity and Capital Resources](index=4&type=section&id=Liquidity%20and%20Capital%20Resources) GCE's liquidity strengthened in H1 2025, with cash and investments increasing by $49.3 million, driven by strong operating cash flow Liquidity Position | Metric | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Unrestricted Cash, Cash Equivalents, and Investments | $373.9M | $324.6M | +$49.3M | - The increase in liquidity is attributed to **cash provided by operations exceeding outlays for share repurchases and capital expenditures** during the first six months of 2025[7](index=7&type=chunk) [2025 Financial Outlook](index=5&type=section&id=2025%20Financial%20Outlook) GCE projects full-year 2025 service revenue between $1,100.3M and $1,107.3M, with diluted EPS ranging from $8.75 to $8.90 2025 Financial Guidance | Guidance | Q3 2025 | Q4 2025 | Full Year 2025 | | :--- | :--- | :--- | :--- | | Service Revenue | $258.5M - $260.5M | $305.0M - $310.0M | $1,100.3M - $1,107.3M | | Operating Margin | 21.8% - 22.2% | 35.1% - 35.8% | 27.5% - 27.9% | | Diluted EPS | $1.69 - $1.74 | $3.07 - $3.18 | $8.75 - $8.90 | - Adjusted non-GAAP diluted EPS guidance is projected to be between **$1.75 and $1.80 for Q3**, **$3.13 and $3.24 for Q4**, and **$8.98 and $9.14 for the full year 2025**[9](index=9&type=chunk)[10](index=10&type=chunk)[11](index=11&type=chunk) [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) GCE's unaudited consolidated financial statements detail strong performance, stable assets, and operating cash flow used for investments and share repurchases [Consolidated Income Statements](index=8&type=section&id=Consolidated%20Income%20Statements) For Q2 2025, service revenue grew to $247.5 million with net income of $41.5 million, while H1 revenue reached $536.8 million with net income of $113.2 million Consolidated Income Statement Summary | (In thousands) | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | Service revenue | $247,499 | $227,463 | $536,809 | $502,138 | | Operating income | $51,789 | $42,719 | $139,812 | $127,197 | | Net income | $41,546 | $34,878 | $113,164 | $102,888 | [Consolidated Balance Sheets](index=9&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, GCE's total assets were $1.021 billion, with cash and cash equivalents at $192.3 million and total stockholders' equity at $778.0 million Consolidated Balance Sheet Summary | (In thousands) | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $422,481 | $419,976 | | Total assets | $1,021,007 | $1,018,425 | | Total current liabilities | $118,990 | $110,966 | | Total liabilities | $243,031 | $234,572 | | Total stockholders' equity | $777,976 | $783,853 | [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For H1 2025, GCE generated $191.6 million in operating cash flow, used $198.7 million in investing activities, and $125.2 million in financing activities Consolidated Cash Flow Summary | (In thousands) | Six Months Ended June 30, | | :--- | :--- | :--- | | | **2025** | **2024** | | Net cash provided by operating activities | $191,639 | $183,526 | | Net cash used in investing activities | ($198,748) | ($19,989) | | Net cash used in financing activities | ($125,236) | ($68,695) | | Net (decrease) increase in cash | ($132,345) | $94,842 | [Non-GAAP Financial Measures](index=11&type=section&id=Non-GAAP%20Financial%20Measures) GCE provides non-GAAP measures, including Adjusted EBITDA, to offer a clearer view of core operating performance, with Q2 2025 Adjusted EBITDA up 15.2% to $67.4 million [Reconciliation of Net Income to Adjusted EBITDA](index=11&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20EBITDA) For Q2 2025, net income of $41.5 million was adjusted to an Adjusted EBITDA of $67.4 million, reflecting a 15.2% increase from Q2 2024 Adjusted EBITDA Reconciliation | (In thousands) | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | Net income | $41,546 | $34,878 | $113,164 | $102,888 | | Adjusted EBITDA | $67,411 | $58,526 | $169,379 | $157,115 | - Management uses Adjusted EBITDA as a supplemental measure of operating performance for internal decision-making and believes it helps investors compare results with historical periods and other companies[31](index=31&type=chunk)[32](index=32&type=chunk) [Reconciliation of GAAP to Non-GAAP Net Income and EPS](index=12&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Net%20Income%20and%20EPS) For Q2 2025, As Adjusted Non-GAAP Net Income was $43.2 million ($1.53 per share), compared to GAAP Net Income of $41.5 million ($1.48 per share) GAAP to Non-GAAP Reconciliation | (In thousands, except per share) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | GAAP Net income | $41,546 | $113,164 | | As Adjusted, Non-GAAP Net income | $43,182 | $116,478 | | GAAP Diluted income per share | $1.48 | $4.00 | | As Adjusted, Non-GAAP Diluted income per share | $1.53 | $4.12 | [Other Information](index=5&type=section&id=Other%20Information) This section includes important disclosures, forward-looking statements outlining potential risks, and details for the Q2 2025 earnings conference call [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) The report contains forward-looking statements subject to risks and uncertainties, including legal actions, partner agreement terminations, and competition - The report includes forward-looking statements that are subject to risks and uncertainties and should not be read as a guarantee of future performance[12](index=12&type=chunk)[13](index=13&type=chunk) - Important risk factors include: (i) legal and regulatory actions, (ii) termination of key university partner agreements, (iii) ability to comply with regulations, and (iv) competition from other education service companies[13](index=13&type=chunk)[15](index=15&type=chunk) [Conference Call Information](index=7&type=section&id=Conference%20Call%20Information) GCE will host a conference call on August 6, 2025, at 4:30 p.m. ET to discuss Q2 2025 results and full-year outlook, with a live webcast available - A conference call to discuss Q2 2025 results is scheduled for **August 6, 2025, at 4:30 p.m. ET**[18](index=18&type=chunk) - A live webcast and replay of the event will be available online[20](index=20&type=chunk)

Financial Performance - Service revenue for Q2 2025 was $247.5 million, an increase of $20.0 million, or 8.8%, compared to $227.5 million in Q2 2024, driven by a 10.3% increase in partner enrollments to 117,283 [2][20] - Operating income for Q2 2025 was $51.8 million, an increase of $9.1 million, or 21.2%, compared to $42.7 million in Q2 2024, with an operating margin of 20.9% [2][20] - Net income for Q2 2025 was $41.5 million, an increase of $6.6 million, or 19.1%, compared to $34.9 million in Q2 2024, with diluted net income per share rising to $1.48 from $1.19 [2][20] Enrollment Growth - GCU enrollments increased to 113,435 at June 30, 2025, a 10.5% increase from 102,600 at June 30, 2024 [2] - University partner enrollments at off-campus sites were 4,990, a 14.0% increase from the previous year, contributing to overall enrollment growth [2] Liquidity and Capital Resources - The liquidity position increased by $49.3 million between December 31, 2024, and June 30, 2025, with unrestricted cash and cash equivalents at $373.9 million [4] - Cash provided by operations exceeded share repurchases and capital expenditures during the six months ended June 30, 2025 [4] Full Year Outlook - For Q3 2025, the company expects diluted EPS guidance of between $1.75 and $1.80, adjusted for non-cash amortization of intangible assets [5] - For the full year 2025, the diluted EPS guidance is between $8.98 and $9.14, also adjusted for non-cash amortization [7]

Company Overview - Grand Canyon Education, Inc. (GCE) is a publicly traded education services company incorporated in 2008, providing services to 20 university partners [4] - The company has 30 years of proven expertise in delivering a full array of support services in the post-secondary education sector, including technological solutions and operational processes [4] - Services offered by GCE include marketing, strategic enrollment management, counseling services, financial services, technology support, compliance, human resources, classroom operations, curriculum development, and faculty recruitment and training [4] Upcoming Financial Results - GCE will report its 2025 second quarter results after market close on August 6, 2025 [1] - A conference call to discuss the results in detail will be held at 1:30 P.M. (4:30 P.M. ET) on the same day [1] Conference Call Participation - Interested participants can register for the call to receive dial-in numbers and a unique PIN for seamless access [2] - Participants are advised to dial in at least ten minutes prior to the start of the call, with journalists invited to listen only [2] Webcast Information - A live webcast of the earnings conference call will be available for investors, journalists, and the general public [3] - A replay of the webcast will be accessible approximately two hours after the conclusion of the call [3]

Core Insights - Investors in the Schools sector may consider Afya (AFYA) and Grand Canyon Education (LOPE) as potential investment opportunities [1] - The Zacks Rank system, which emphasizes positive earnings estimate revisions, is a key tool for identifying value opportunities [2] Valuation Metrics - Afya has a Zacks Rank of 1 (Strong Buy), while Grand Canyon Education has a Zacks Rank of 3 (Hold), indicating a stronger earnings outlook for AFYA [3] - AFYA's forward P/E ratio is 10.16, significantly lower than LOPE's forward P/E of 20.16, suggesting AFYA may be undervalued [5] - The PEG ratio for AFYA is 0.55, compared to LOPE's PEG ratio of 1.34, indicating better expected earnings growth relative to its price [5] - AFYA's P/B ratio is 2.02, while LOPE's P/B ratio is 6.42, further highlighting AFYA's relative valuation advantage [6] - Based on these metrics, AFYA holds a Value grade of A, while LOPE has a Value grade of C, making AFYA the more attractive option for value investors [6]

Core Insights - The demand for digital educational alternatives is increasing as parents and students seek seamless ways to earn degrees, with a notable shift towards technology-driven and AI-focused options [1][4] - Key education providers like Stride, Inc. (LRN) and Grand Canyon Education, Inc. (LOPE) are transforming education through technology [1] Stride, Inc. (LRN) - Stride offers full-time online K-12 programs and is expanding its focus on career learning and adult certification programs [2] - The company has a market cap of approximately $6.03 billion and is experiencing record enrollment growth, particularly in its Career Learning segment, which saw a 32% year-over-year growth [4][5] - Stride raised its fiscal 2025 revenue guidance to $2.37-$2.385 billion, indicating a year-over-year growth of 16.2-16.9% [6] - The company is focused on enhancing its career education offerings, which aligns with the ongoing regulatory reforms in the U.S. education industry [5][6] Grand Canyon Education, Inc. (LOPE) - Grand Canyon Education has a market cap of about $5.2 billion and is benefiting from diversified university partnerships and tech-based offerings [8] - The company reported a 5.8% year-over-year enrollment growth at Grand Canyon University and a 12.1% increase in enrollments from university partners [10] - LOPE has launched 48 new programs since 2023, focusing on high-demand fields to align with workforce requirements [11] - For fiscal 2025, LOPE expects service revenues between $1,079.8 million and $1,099.8 million, reflecting a year-over-year growth of 4.5-6.5% [12] Stock Performance & Valuation - Year-to-date, Stride's share price performance has outperformed Grand Canyon Education [13] - Stride trades below LOPE on a forward price-to-sales (P/S) basis, suggesting a more attractive valuation for investors [14] - The Zacks Consensus Estimate indicates LRN's fiscal 2025 EPS will grow by 51.2% year-over-year, while LOPE's EPS is expected to grow by 8.8% [18][20] Return on Equity (ROE) - Grand Canyon Education's trailing 12-month ROE is 30.9%, significantly higher than Stride's average of 23.4%, indicating better efficiency in generating shareholder returns [20] Conclusion - Both Stride and Grand Canyon Education present strong opportunities in the online education market, but Stride is highlighted as the stronger investment case due to superior near-term earnings growth estimates and more attractive valuation [21][22]

Core Viewpoint - Investors in the Schools sector should consider American Public Education (APEI) and Grand Canyon Education (LOPE) as potential undervalued stocks [1] Valuation Metrics - APEI has a forward P/E ratio of 20.95, while LOPE has a forward P/E of 21.55 [5] - APEI's PEG ratio is 1.40, compared to LOPE's PEG ratio of 1.44 [5] - APEI's P/B ratio is 1.99, significantly lower than LOPE's P/B of 6.87 [6] Investment Grades - Both APEI and LOPE have a Zacks Rank of 2 (Buy), indicating positive earnings estimate revisions [3] - APEI holds a Value grade of A, while LOPE has a Value grade of C, suggesting APEI is the superior value option [6][7]

Core Insights - The article compares American Public Education (APEI) and Grand Canyon Education (LOPE) to determine which stock offers better value for investors [1] Valuation Metrics - APEI has a Zacks Rank of 2 (Buy), indicating a stronger earnings outlook compared to LOPE, which has a Zacks Rank of 3 (Hold) [3] - APEI's forward P/E ratio is 19.47, while LOPE's forward P/E ratio is 22.55, suggesting APEI may be undervalued [5] - APEI has a PEG ratio of 1.30, compared to LOPE's PEG ratio of 1.50, indicating APEI's expected earnings growth is more favorable [5] - APEI's P/B ratio is 1.85, significantly lower than LOPE's P/B ratio of 7.09, further supporting APEI's valuation attractiveness [6] Value Grades - APEI holds a Value grade of A, while LOPE has a Value grade of D, indicating APEI is considered a better value investment [6] - APEI has experienced stronger estimate revision activity and more attractive valuation metrics than LOPE, leading to the conclusion that APEI is the superior option for value investors [7]