On Wednesday, BMO (TSX:BMO) Capital Markets adjusted its outlook on Grand Canyon Education (NASDAQ:LOPE) shares, increasing the price target to $155 from $150 while maintaining an Outperform rating on the stock.
The education services provider reported an adjusted earnings per share (EPS) that surpassed both BMO Capital's projections and the consensus.
The company also saw robust enrollment growth, with new enrollments continuing to show strength. However, it is anticipated that this growth may slow down later in the year due to more challenging comparisons.
Grand Canyon Education's management has confirmed their expectations for normal growth at their ground campuses in the fall, despite delays with the Free Application for Federal Student Aid (FAFSA).
They have taken proactive measures by reaching out to students who were unable to submit their FAFSA applications within the designated timeframe. Additionally, the company has slightly increased its guidance for the second quarter of 2024.
The positive developments in Grand Canyon Education's performance and the proactive steps taken by management to ensure student enrollment have led to BMO Capital raising its estimates.
The new price target reflects the firm's confidence in the company's continued growth and its ability to navigate the challenges ahead.
InvestingPro Insights
Grand Canyon Education's (NASDAQ:LOPE) recent performance has caught the attention of investors and analysts alike. With a market capitalization of $4.16 billion and a solid track record over the last twelve months, the company is trading at a high revenue valuation multiple of 5.8, reflecting investor confidence in its business model. The InvestingPro Tips highlight that Grand Canyon Education holds more cash than debt on its balance sheet, indicating a strong financial position. This is complemented by the company's ability to cover interest payments with its cash flows, and its liquid assets surpassing short-term obligations, providing further assurance of financial stability.
The stock's low price volatility suggests it might be a suitable option for investors seeking stability in the education services sector. Moreover, analysts have a positive outlook on the company's profitability for the year, which is supported by the fact that Grand Canyon Education has been profitable over the last twelve months. The company's shares are trading near their 52-week high, with a price 96.44% of that peak, and a recent price total return of 25.02% over the past year, indicating strong market performance.
Investors interested in deeper analysis and additional insights can explore further with InvestingPro, which lists 9 additional InvestingPro Tips for Grand Canyon Education. To enrich your investment research, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.