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Strategic Education Q3 Earnings & Revenues Beat, EBITDA Up Y/Y
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Strategic Education, Inc., or SEI (STRA - Free Report) , reported impressive results for third-quarter 2024. Its quarterly earnings and revenues topped the Zacks Consensus Estimate and increased year over year.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Shares of this education services holding company gained 2.2% on Thursday.
The company witnessed strong employer affiliated enrollment in the U.S. Higher Education (USHE) segment, strong growth from Sophia subscriptions in the Education Technology Services (ETS) segment and another quarter of total enrollment growth in the Australia/New Zealand (ANZ) segment.
Inside the Headlines
SEI reported adjusted earnings per share (EPS) of $1.16, which strongly topped the Zacks Consensus Estimate of 81 cents by 43.2% and rose 19.6% from the year-ago quarter.
Strategic Education Inc. Price, Consensus and EPS Surprise
Total revenues of $305.96 million surpassed the consensus estimate of $298.69 million by 2.4% and increased 7% from the year-ago period. On a constant-currency basis, revenues increased 6.5% to $304.4 million in the quarter.
Segment Details
USHE: This segment comprises Strayer and Capella Universities. The segment’s revenues increased 2.9% year over year to $207.7 million, backed by solid enrollment.
Student enrollment increased 4.8% from the year-ago quarter’s level to 86,533 students. FlexPath enrollment was 24% of USHE enrollment compared with 22% in a year ago.
During the quarter, the operating margin rose to 5.5% from 5.2%, up 30 basis points (bps) from the year-ago quarter.
ETS: This segment includes Employer Solutions, Workforce Edge and Sophia Learning. The segment’s quarterly revenues were $26.3 million, up 26.2% year over year, backed by solid growth in Sophia Learning subscriptions and employer-affiliated enrollment.
Sophia Learning’s average total subscribers increased 33% from the year-ago period’s levels. Employer-affiliated enrollment was 29.8% of USHE enrollment compared with 27.8% in the year-ago period.
Its operating margin was 41% in the reported quarter, up 10 bps from a year ago.
ANZ: This segment includes Torrens University, Think Education and Media Design School. The segment's revenues were $71.9 million, up 13.7% year over year, driven by higher enrollment and revenue-per-student. On a constant-currency basis, revenues rose 11.3% to $70.4 million year over year.
Student enrollment within ANZ rose 5.1% to 19,205 students during the reported quarter compared with the year-ago quarter.
The operating margin was 20.6%, down 130 bps in the year-ago period. On a constant-currency basis, the operating income margin was 20.7%, down from 21.9% in the year-ago period.
STRA’s Operating Highlights
Adjusted operating income was up 13.8% to $37.1 million from $32.6 million in the year-ago quarter. The adjusted operating margin of 12.1% expanded 70 bps from the year-ago quarter.
Adjusted EBITDA was $56.2 million, up from $49.5 million in the year-ago quarter.
STRA’s Financial Details
As of Sept. 30, 2024, SEI had cash and cash equivalents of $195.89 million, up from $168.5 million in 2023-end. There was no long-term debt at the third-quarter end compared with $61.4 million in 2023-end. During the third quarter, the company repaid the remaining $61.3 million of outstanding debt on its revolving credit facility.
Cash provided by operating activities was $153.4 million in the first nine months of 2024, up from $87.2 million in the comparable year-ago period. In the first nine months, capital expenditures were $29.3 million compared with $27.3 million a year ago.
Adtalem Global Education Inc. (ATGE - Free Report) posted better-than-expected results in first-quarter fiscal 2025. Earnings and revenues surpassed their respective Zacks Consensus Estimate and increased year over year, given strong enrollment growth and strategic initiatives.
ATGE raised its fiscal 2025 guidance, projecting revenues between $1.69 billion and $1.73 billion, reflecting confidence in sustained growth momentum.
Leggett & Platt, Inc. (LEG - Free Report) reported lower-than-expected results for the third quarter of 2024. Adjusted earnings and sales missed the Zacks Consensus Estimate and declined year over year.
Legget believes that the weakness in demand will continue into the fourth quarter, based on which it lowered its 2024 sales and EPS guidance.
Mohawk Industries, Inc. (MHK - Free Report) reported strong third-quarter 2024 results (ended Sept. 30). Its earnings surpassed the Zacks Consensus Estimate and improved from the prior year despite pricing pressures and a negative mix.
As global conflicts, political uncertainty and inflation are weighing on consumer confidence and discretionary spending around the world, MHK does not see an industry improvement this year. It also expects recent U.S. hurricanes to negatively impact its fourth-quarter sales by $25-$40 million.
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Strategic Education Q3 Earnings & Revenues Beat, EBITDA Up Y/Y
Strategic Education, Inc., or SEI (STRA - Free Report) , reported impressive results for third-quarter 2024. Its quarterly earnings and revenues topped the Zacks Consensus Estimate and increased year over year.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Shares of this education services holding company gained 2.2% on Thursday.
The company witnessed strong employer affiliated enrollment in the U.S. Higher Education (USHE) segment, strong growth from Sophia subscriptions in the Education Technology Services (ETS) segment and another quarter of total enrollment growth in the Australia/New Zealand (ANZ) segment.
Inside the Headlines
SEI reported adjusted earnings per share (EPS) of $1.16, which strongly topped the Zacks Consensus Estimate of 81 cents by 43.2% and rose 19.6% from the year-ago quarter.
Strategic Education Inc. Price, Consensus and EPS Surprise
Strategic Education Inc. price-consensus-eps-surprise-chart | Strategic Education Inc. Quote
Total revenues of $305.96 million surpassed the consensus estimate of $298.69 million by 2.4% and increased 7% from the year-ago period. On a constant-currency basis, revenues increased 6.5% to $304.4 million in the quarter.
Segment Details
USHE: This segment comprises Strayer and Capella Universities. The segment’s revenues increased 2.9% year over year to $207.7 million, backed by solid enrollment.
Student enrollment increased 4.8% from the year-ago quarter’s level to 86,533 students. FlexPath enrollment was 24% of USHE enrollment compared with 22% in a year ago.
During the quarter, the operating margin rose to 5.5% from 5.2%, up 30 basis points (bps) from the year-ago quarter.
ETS: This segment includes Employer Solutions, Workforce Edge and Sophia Learning. The segment’s quarterly revenues were $26.3 million, up 26.2% year over year, backed by solid growth in Sophia Learning subscriptions and employer-affiliated enrollment.
Sophia Learning’s average total subscribers increased 33% from the year-ago period’s levels. Employer-affiliated enrollment was 29.8% of USHE enrollment compared with 27.8% in the year-ago period.
Its operating margin was 41% in the reported quarter, up 10 bps from a year ago.
ANZ: This segment includes Torrens University, Think Education and Media Design School. The segment's revenues were $71.9 million, up 13.7% year over year, driven by higher enrollment and revenue-per-student. On a constant-currency basis, revenues rose 11.3% to $70.4 million year over year.
Student enrollment within ANZ rose 5.1% to 19,205 students during the reported quarter compared with the year-ago quarter.
The operating margin was 20.6%, down 130 bps in the year-ago period. On a constant-currency basis, the operating income margin was 20.7%, down from 21.9% in the year-ago period.
STRA’s Operating Highlights
Adjusted operating income was up 13.8% to $37.1 million from $32.6 million in the year-ago quarter. The adjusted operating margin of 12.1% expanded 70 bps from the year-ago quarter.
Adjusted EBITDA was $56.2 million, up from $49.5 million in the year-ago quarter.
STRA’s Financial Details
As of Sept. 30, 2024, SEI had cash and cash equivalents of $195.89 million, up from $168.5 million in 2023-end. There was no long-term debt at the third-quarter end compared with $61.4 million in 2023-end. During the third quarter, the company repaid the remaining $61.3 million of outstanding debt on its revolving credit facility.
Cash provided by operating activities was $153.4 million in the first nine months of 2024, up from $87.2 million in the comparable year-ago period. In the first nine months, capital expenditures were $29.3 million compared with $27.3 million a year ago.
Zacks Rank
SEI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Releases
Adtalem Global Education Inc. (ATGE - Free Report) posted better-than-expected results in first-quarter fiscal 2025. Earnings and revenues surpassed their respective Zacks Consensus Estimate and increased year over year, given strong enrollment growth and strategic initiatives.
ATGE raised its fiscal 2025 guidance, projecting revenues between $1.69 billion and $1.73 billion, reflecting confidence in sustained growth momentum.
Leggett & Platt, Inc. (LEG - Free Report) reported lower-than-expected results for the third quarter of 2024. Adjusted earnings and sales missed the Zacks Consensus Estimate and declined year over year.
Legget believes that the weakness in demand will continue into the fourth quarter, based on which it lowered its 2024 sales and EPS guidance.
Mohawk Industries, Inc. (MHK - Free Report) reported strong third-quarter 2024 results (ended Sept. 30). Its earnings surpassed the Zacks Consensus Estimate and improved from the prior year despite pricing pressures and a negative mix.
As global conflicts, political uncertainty and inflation are weighing on consumer confidence and discretionary spending around the world, MHK does not see an industry improvement this year. It also expects recent U.S. hurricanes to negatively impact its fourth-quarter sales by $25-$40 million.