Higher education company Strategic Education (NASDAQ:STRA) will be reporting earnings tomorrow before market open. Here’s what to expect.
Strategic Education beat analysts’ revenue expectations by 2.4% last quarter, reporting revenues of $306 million, up 7% year on year. It was a stunning quarter for the company, with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates. It reported 86,533 domestic students, up 4.8% year on year.
Is Strategic Education a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Strategic Education’s revenue to grow 3.1% year on year to $312 million, slowing from the 12.1% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.24 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Strategic Education has missed Wall Street’s revenue estimates twice over the last two years.
Looking at Strategic Education’s peers in the education services segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Adtalem delivered year-on-year revenue growth of 13.9%, beating analysts’ expectations by 4.7%, and Lincoln Educational reported revenues up 16.4%, topping estimates by 6.9%. Adtalem traded up 4.6% following the results while Lincoln Educational was also up 9.8%.
Read our full analysis of Adtalem’s results here and Lincoln Educational’s results here.
Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good 2024. An economic soft landing (so far), the start of the Fed's rate cutting campaign, and the election of Donald Trump were positives for the market, and while some of the education services stocks have shown solid performance, the group has generally underperformed, with share prices down 3.3% on average over the last month. Strategic Education’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $123 (compared to the current share price of $97.85).
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