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Truist Financial Reiterates Buy Rating on Strategic Education Without Giving a Price Target
Yahoo Finance· 2025-09-10 04:20
Group 1 - Strategic Education, Inc. (NASDAQ:STRA) is recognized as one of the 14 Best Small Cap Stocks to Buy Right Now, with Truist Financial reiterating its Buy rating without a price target [1] - The company experienced a decline in Q2 FY2025 student enrollment within the U.S. Higher Education (USHE) segment by 0.8% to 86,339, and a 3.1% drop in the Australia/New Zealand (ANZ) segment to 18,524 year-over-year [2] - Despite the enrollment declines, Strategic Education saw strong growth in Sophia Learning, with total subscribers increasing nearly 40% and revenue rising 39.8% to $16.4 million [2] Group 2 - The overall revenue for Strategic Education was reported at $321.5 million, reflecting a 2.9% increase from the previous year, although it slightly missed consensus estimates [2] - The adjusted earnings per share were reported at $1.52, surpassing the estimates of $1.43 [2] - Analysts have set an average price target of $105 for Strategic Education, indicating an upside potential of approximately 28.11% from current levels [3] Group 3 - Strategic Education operates through three segments: U.S. Higher Education (USHE), Australia/New Zealand (ANZ), and Education Technology Services, providing both campus-based and online post-secondary education [3]
Strategic Education: EdTech Growth Offsets Stall In Higher Ed Operations
Seeking Alpha· 2025-07-31 09:25
Core Insights - Strategic Education (STRA), an EdTech company, reported disappointing Q2 results that did not meet Wall Street expectations [1] Company Overview - Strategic Education operates several educational brands including Strayer, Capella, Sophia Learning, and WorkForce Edge [1] Financial Performance - The Q2 results released by Strategic Education have not pleased investors, indicating potential challenges in financial performance [1]
Strategic Education (STRA) Q2 EPS Up 16%
The Motley Fool· 2025-07-31 04:29
Core Insights - Strategic Education reported adjusted non-GAAP earnings per share of $1.54, exceeding analyst estimates of $1.43, with revenue of $323.5 million, slightly above consensus by $0.5 million [1][2] - The company experienced year-over-year growth in both earnings and revenue, driven by strong performance in the Education Technology Services segment and employer partnerships, despite declines in traditional student enrollment [1][4] Financial Performance - Adjusted EPS (Non-GAAP) increased by 15.8% year-over-year from $1.33 in Q2 2024 to $1.54 in Q2 2025 [2] - Revenue (Non-GAAP) grew by 3.6% year-over-year from $312.3 million in Q2 2024 to $323.5 million in Q2 2025 [2] - Adjusted EBITDA (Non-GAAP) rose to $68.3 million, up 7.9% from $63.3 million in Q2 2024 [2] - Operating margin (Non-GAAP) improved to 15.2%, an increase of 1.1 percentage points from 14.1% in Q2 2024 [2] Strategic Focus - The company operates through three main university brands: Capella University, Strayer University, and Torrens University, with a focus on online delivery and employer-driven programs [3] - Strategic Education has prioritized partnerships with employers, particularly in high-demand fields like healthcare, and has introduced innovative programs like FlexPath for self-paced learning [4][6] - The Education Technology Services segment saw a revenue surge of nearly 50% to $36.7 million, with Sophia Learning reporting a 39.8% revenue increase and a 40% rise in average subscribers [6] Enrollment Trends - Total enrollment decreased by 0.8% to 86,339 students, but the proportion of students enrolled through employer partnerships reached a record 31.8%, up from 29.3% in Q2 2024 [7] - The healthcare portfolio outperformed, with enrollment up 8% year-over-year, representing 47% of the U.S. Higher Education total [7] - The Australia/New Zealand division faced a 2.8% revenue decline and a 3.1% drop in total enrollment due to regulatory challenges, although domestic student growth provided some offset [8] Cash Flow and Shareholder Returns - The company generated $77.7 million in free cash flow over the first six months of 2025, slightly down from $82.0 million in the prior year [9] - Capital expenditures for the first half of 2025 were $21.2 million, compared to $19.9 million in the same period in 2024, with total capital expenditures including cloud computing investments at $29.7 million [9] - The company repurchased 325,844 shares for $28.0 million and maintained its quarterly dividend at $0.60 per share [9] Management Outlook - Management expressed confidence in moderate revenue growth and margin expansion for 2025, supported by innovation and employer partnerships, but did not provide updated financial guidance [11] - Key areas to monitor include trends in employer-affiliated enrollment, performance of education technology offerings, and growth in domestic student numbers, particularly in Australia [12]
APEI Q1 Earnings & Revenues Beat Estimates, Both Up Y/Y, Stock Gains
ZACKS· 2025-05-13 17:10
Core Insights - American Public Education, Inc. (APEI) reported strong first-quarter 2025 results, with adjusted earnings and total revenues exceeding expectations and showing year-over-year growth [1][2] - The performance was primarily driven by contributions from Rasmussen University (RU), American Public University System (APUS), and Hondros College of Nursing (HCN), while the Graduate School (GSUSA) segment experienced a revenue decline [1][2] Financial Performance - APEI's adjusted earnings per share (EPS) reached 41 cents, significantly surpassing the Zacks Consensus Estimate of 15 cents by 173.3%, compared to a loss of six cents per share in the same quarter last year [3] - Total revenues amounted to $164.6 million, exceeding the consensus mark of $162 million by 1.6% and growing 6.6% year over year, supported by net course registration growth and tuition increases [4] - Total costs and expenses rose 2% year over year to $152.3 million, driven by a 3.5% increase in instructional costs and an 8.5% rise in selling and promotional expenses [4] - Adjusted EBITDA increased by 24% year over year to $21.2 million, with an adjusted EBITDA margin of 13%, expanding 200 basis points from 11% [5] Segment Performance - APUS reported revenues of $83.9 million, a 4.1% increase from $80.7 million year over year, driven by net course registrations and tuition increases [6] - RU's revenues grew 11.5% year over year to $59.3 million, attributed to enrollment growth and tuition hikes, with total student enrollment increasing 7.4% to 14,500 [7][8] - HCN's revenues rose 7.5% year over year to $17.7 million, supported by student enrollment growth, although it reported a negative EBITDA margin of 1% [8][9] - GSUSA's revenues declined 11.9% year over year to $3.7 million, with a negative EBITDA margin of 57% [10] Cash and Debt Position - As of March 31, 2025, APEI had cash, cash equivalents, and restricted cash of $187.5 million, up from $158.9 million at the end of 2024 [11] - Net long-term debt slightly increased to $93.7 million from $93.4 million at the end of 2024 [11] Guidance and Outlook - For Q2 2025, APEI expects total revenues to increase by 4-5% year over year to $160-$162 million, with a projected loss per share between 13 cents and four cents [12] - Adjusted EBITDA for Q2 is anticipated to be between $11.5 million and $14 million, reflecting year-over-year growth of 6% to 28% [12] - The company revised its 2025 guidance, expecting total revenues to grow 4-6% year over year to $650-$660 million, with adjusted EBITDA projected between $77 million and $87 million [14]
Strategic Education(STRA) - 2024 Q4 - Earnings Call Transcript
2025-02-27 18:02
Financial Data and Key Metrics Changes - For the full year 2024, revenue increased by 8% and operating income increased by 26%, resulting in almost 200 basis points of operating margin expansion [6] - Adjusted earnings per share grew by 31% for the year to $4.87 [7] Business Line Data and Key Metrics Changes - In US higher education, revenue increased by 5% for the year, but decreased in the fourth quarter due to higher scholarships and a shift towards employer-affiliated students [8] - The Australia and New Zealand segment saw revenue growth of 11% on a constant currency basis, driven by enrollment growth and higher revenue per student [9] - The education technology services segment achieved record revenue growth of over 30% to exceed $100 million, with operating income increasing by almost 50% [12] Market Data and Key Metrics Changes - US higher education average total enrollment grew by 6% in 2024, with employer-affiliated enrollment growing by 16% [7] - The Australia and New Zealand segment's average total enrollment grew by 5% for the year [8] Company Strategy and Development Direction - The company continues to focus on productivity and disciplined cost management, which allowed expense growth to remain below revenue growth in US higher education [8] - The network of corporate partners is a major competitive strength, with over 70% of incremental total enrollment in US higher education coming through these partnerships [14] - The company plans to market more towards the domestic Australian market to counteract potential enrollment caps [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential, projecting mid-single-digit growth in US higher education and high single-digit growth in Australia and New Zealand [41] - The company is monitoring the evolving political and regulatory environment in Australia, particularly regarding international student immigration [11][22] Other Important Information - The company generated approximately $217 million pretax cash from operations in 2024, with $128 million of distributable free cash flow remaining after expenses and dividends [15] - The company repaid a $61 million balance on its revolver and refinanced a $250 million revolver, ending 2024 with just under $200 million in cash and marketable securities [16] Q&A Session Summary Question: Enrollment trends and growth expectations - Management noted that corporate partnership enrollment remains strong, and while growth may normalize to long-term trends, they expect fluctuations in quarterly performance [20] Question: Regulatory changes in Australia and New Zealand - Management explained that the proposed international student caps were replaced with a ministerial direction focusing on visa processing times, which may impact enrollment later in the year [22][25] Question: Impact of US government changes on business - Management indicated that they have a significant presence among federal government employees and are monitoring the situation as new political appointees are confirmed [27] Question: Adjusted operating expenses and future guidance - Management confirmed that the adjusted operating expense of $271 million in 2024 is expected to be appropriate for 2025, with some seasonality in marketing investments [38] Question: Revenue per student decline in US higher education - Management attributed the decline to a shift towards employer-affiliated students and higher scholarships, expecting revenue per student to remain stable in 2025 [54][55]