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. -- ...

Perdoceo Education Corporation (PRDO) has completed its acquisition of the University of St. Augustine for Health Sciences, LLC (“USAHS”). This transaction was valued at approximately $138 million in cash, net of cash acquired.Shares of this postsecondary education provider rose 1.8% during yesterday’s trading hours.PRDO to Drive Growth With USAHS’ AcquisitionThis acquisition is expected to enhance PRDO's financial performance and contribute to its long-term growth trajectory. Founded in 1979, USAHS is a le ...

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of a ...

Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the 'long' context, investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Whil ...

Shares of Perdoceo Education (PRDO) have been strong performers lately, with the stock up 30.7% over the past month. The stock hit a new 52-week high of $29.47 in the previous session. Perdoceo Education has gained 59.2% since the start of the year compared to the 11.3% move for the Zacks Consumer Discretionary sector and the 3.9% return for the Zacks Schools industry.What's Driving the Outperformance?The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consen ...

Perdoceo Education Corporation (PRDO) posted better-than-expected results in third-quarter 2024, with earnings and revenues surpassing the Zacks Consensus Estimate.However, on a year-over-year basis, both metrics declined due to the lagging impact of 2023 operational changes at the American InterContinental University System (“AIUS”) and the simplification of professional development offerings at Colorado Technical University (“CTU”).Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.F ...

Perdoceo Education (PRDO) came out with quarterly earnings of $0.59 per share, beating the Zacks Consensus Estimate of $0.53 per share. This compares to earnings of $0.64 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 11.32%. A quarter ago, it was expected that this for-profit education company would post earnings of $0.58 per share when it actually produced earnings of $0.60, delivering a surprise of 3.45%.Over the last four ...

Core Insights - Perdoceo Education Corp is investing in new virtual campus and mobile platforms to enhance learning and accelerate student enrollment [1] - The company reported better-than-expected EPS and revenue growth in the last quarterly report, with positive expectations for 2024 and 2025 EPS growth [2] - The use of AI and chatbots is streamlining student engagement and may improve future cash flow margins [3][4] Investment and Financial Performance - The company has initiated a stock repurchase program, acquiring shares at approximately $17 per share, indicating potential for stock price appreciation [7] - Recent increases in net income and free cash flow suggest a positive financial trajectory, despite some concerns over revenue growth [8] - The total assets and equity have significantly increased, with total assets reaching $1,078.2 million, indicating strong business growth [11] Strategic Initiatives - New agreements with employers are expected to reduce recruiting and marketing costs while increasing student enrollment, particularly among those with little or no debt [5] - The acquisition of non-degree professional development programs is anticipated to boost student enrollment and diversify offerings [6] - The company is focusing on enhancing technology infrastructure to improve the learning experience for adult learners [4] Valuation and Market Position - The current valuation suggests that Perdoceo is significantly undervalued compared to competitors, with a target price of $40 per share based on DCF analysis [18][19] - The company's P/E ratios are lower than sector medians, indicating potential for stock price appreciation [19][20] - Analysts see significant upside potential in the stock price, reinforcing the view that the company is undervalued [19] Future Outlook - Expectations for future free cash flow growth are optimistic, supported by the development of digital technologies and operational changes [13][25] - The company is positioned to benefit from demographic trends and the increasing demand for online education, particularly among adult learners [4][25] - Continued focus on enhancing academic outcomes and retention through technology investments is expected to drive future growth [25]

Group 1: Earnings Performance - Perdoceo Education reported quarterly earnings of $0.60 per share, exceeding the Zacks Consensus Estimate of $0.58 per share, but down from $0.61 per share a year ago, representing an earnings surprise of 3.45% [1] - The company has surpassed consensus EPS estimates for the last four quarters [2] - Revenue for the quarter ended June 2024 was $166.74 million, surpassing the Zacks Consensus Estimate by 3.62%, but down from $186.56 million year-over-year [2] Group 2: Stock Performance and Outlook - Perdoceo Education shares have increased approximately 43.8% since the beginning of the year, significantly outperforming the S&P 500's gain of 14% [3] - The future performance of the stock will depend on management's commentary during the earnings call and the company's earnings outlook [4][6] - The current consensus EPS estimate for the upcoming quarter is $0.53 on revenues of $165.53 million, and for the current fiscal year, it is $2.21 on revenues of $653.72 million [7] Group 3: Industry Context - The Schools industry, to which Perdoceo Education belongs, is currently ranked in the top 25% of over 250 Zacks industries, indicating a favorable outlook [8] - The performance of Perdoceo Education's stock may also be influenced by the overall industry outlook [8] - Another company in the same industry, Afya, is expected to report quarterly earnings of $0.37 per share, reflecting a year-over-year increase of 27.6% [9]

Financial Data and Key Metrics Changes - The company reported second quarter net income of $38.4 million, or $0.57 per diluted share, compared to $54.7 million, or $0.80 per diluted share in the prior year [10] - Adjusted earnings per diluted share was $0.60, slightly down from $0.61 in the previous year [10] - Revenue for the second quarter was $166.7 million, a decrease of 10.6% from $186.6 million in the prior year quarter [11] - Operating income for the second quarter was $46 million, down from $48.1 million in the prior year [10] Business Line Data and Key Metrics Changes - At CTU, second quarter revenue decreased by 5.4% to $112.8 million, primarily due to changes in professional development offerings [14] - Operating income at CTU was $42.9 million, an increase from $40.5 million in the prior year [14] - At AIU System, second quarter revenue was $53.7 million, down 19.9% from the prior year quarter, with operating income decreasing to $12.9 million from $17.1 million [15] Market Data and Key Metrics Changes - Total enrollments at CTU increased by 14.7% year-over-year, driven by a positive timing impact from the academic calendar and growth in corporate engagement programs [12] - AIU System experienced an 18.2% decline in total enrollments, although the rate of decline has moderated compared to previous quarters [8][13] Company Strategy and Development Direction - The company announced an 18.2% increase in the quarterly dividend to $0.13 per share, marking the first increase since the inaugural dividend payment [6] - A definitive agreement was made to acquire the University of St. Augustine for Health Sciences for approximately $142 million to $144 million, expected to enhance the company's academic offerings [7][20] - The company is focusing on enhancing corporate engagement programs and utilizing technology to improve student experiences [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in high levels of student retention and engagement, expecting these trends to continue through 2024 [22] - The company anticipates full-year 2024 adjusted operating income to range between $179 million and $190 million, an increase from previous guidance [21] - The outlook for AIU System includes expectations for double-digit enrollment growth by year-end 2024, despite current revenue challenges [24] Other Important Information - The effective tax rate for the second quarter was 27.5%, with expectations for the full year to be between 26.5% and 27.5% [16] - Year-to-date net cash flows from operations were $93 million, an increase from $66.2 million in the prior year [17] - The company ended the quarter with $675.2 million in cash and equivalents, an increase of approximately $71 million since the end of the previous year [18] Q&A Session Summary Question: What are the expectations for student enrollment growth? - Management expects total student enrollments at AIU System to experience double-digit growth by year-end 2024, despite current declines [24] Question: How will the acquisition of St. Augustine impact the company? - The acquisition is expected to be immediately accretive to adjusted operating income beginning in 2025 [20] Question: What is the outlook for revenue in the second half of 2024? - Revenue is expected to grow in the fourth quarter, offsetting declines in the third quarter due to consistent academic calendars [12][22]