Let's dig into the relative performance of Grand Canyon Education (NASDAQ:LOPE) and its peers as we unravel the now-completed Q1 education services earnings season.
A whole industry has emerged to address the problem of rising education costs, offering consumers alternatives to traditional education paths such as four-year colleges. These alternative paths, which may include online courses or flexible schedules, make education more accessible to those with work or child-rearing obligations. However, some have run into issues around the value of the degrees and certifications they provide and whether customers are getting a good deal. Those who don’t prove their value could struggle to retain students, or even worse, invite the heavy hand of regulation.
The 8 education services stocks we track reported a strong Q1; on average, revenues beat analyst consensus estimates by 3.6%. while next quarter's revenue guidance was in line with consensus. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and education services stocks have held roughly steady amidst all this, with share prices up 4.1% on average since the previous earnings results.
Grand Canyon Education (NASDAQ:LOPE) Founded in 1949, Grand Canyon Education (NASDAQ:LOPE) is an educational services provider known for its operation at Grand Canyon University.
Grand Canyon Education reported revenues of $274.7 million, up 9.8% year on year, in line with analysts' expectations. It was a mixed quarter for the company, with optimistic earnings guidance for the next quarter. On the other hand, the number of students unfortunately missed and full-year earnings guidance missed Wall Street's estimates.
Grand Canyon Education delivered the weakest performance against analyst estimates of the whole group. The stock is down 3.4% since the results and currently trades at $135.2.
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Best Q1: Strategic Education (NASDAQ:STRA) Formed through the merger of Strayer Education and Capella Education in 2018, Strategic Education (NASDAQ:STRA) is a career-focused higher education provider.
Strategic Education reported revenues of $290.3 million, up 13.1% year on year, outperforming analysts' expectations by 5.8%. It was a stunning quarter for the company, with an impressive beat of analysts' earnings estimates.
The stock is up 9.1% since the results and currently trades at $109.84.
Bright Horizons (NYSE:NYSE:BFAM) Founded in 1986, Bright Horizons (NYSE:BFAM) is a global provider of child care, early education, and workforce support solutions.
Bright Horizons reported revenues of $622.7 million, up 12.5% year on year, exceeding analysts' expectations by 1.2%. It was an ok quarter for the company, with a decent beat of analysts' organic revenue estimates but full-year revenue guidance missing analysts' expectations.
Bright Horizons had the weakest full-year guidance update in the group. The stock is up 2.4% since the results and currently trades at $106.79.
Adtalem (NYSE:ATGE) Formerly known as DeVry Education Group, Adtalem Global Education (NYSE:ATGE) is a global provider of workforce solutions and educational services.
Adtalem reported revenues of $412.7 million, up 11.8% year on year, surpassing analysts' expectations by 5.4%. It was a very strong quarter for the company, with an impressive beat of analysts' earnings estimates and full-year revenue guidance exceeding analysts' expectations.
Adtalem achieved the highest full-year guidance raise among its peers. The stock is up 25.9% since the results and currently trades at $65.95.
Universal Technical Institute (NYSE:UTI) Founded in 1965, Universal Technical Institute (NYSE: UTI) is a leading provider of technical training programs, specializing in automotive, diesel, collision repair, motorcycle, and marine technicians.
Universal Technical Institute reported revenues of $184.2 million, up 12.4% year on year, surpassing analysts' expectations by 4%. It was a decent quarter for the company, with full-year revenue guidance beating analysts' expectations but a miss of analysts' earnings estimates.
The stock is down 10.9% since the results and currently trades at $14.86.
