Adtalem Global Education Inc., symbol ATGE, impressed investors with its second-quarter fiscal 2024 results. Earnings and revenues exceeded the Zacks Consensus Estimate and experienced year-on-year growth. The stock gained 1.6% in the after-hours trading session on Jan 30.
Earnings & Revenue Discussion
The company’s adjusted earnings per share (EPS) of $1.23 surpassed the Zacks Consensus Estimate of $1.01 by 21.8% and rose 51.4% from $1.17 in the year-ago quarter. Moreover, its revenues of $393.2 million beat the consensus mark of $374.1 million by 5.1% and increased 8.4% year over year.
Segment Details
Adtalem’s Chamberlain segment experienced an 8.6% revenue increase, totaling $153.6 million, with total student enrollment growing 6.6% to 35,592 students. Meanwhile, the Walden segment generated revenues of $146.8 million, reflecting an 11.3% increase. Total student enrollment in this segment grew 7.9% to reach 40,971 students. However, the Medical and Veterinary segment’s revenues grew 3.8% to $92.9 million, with total student enrollment decreasing 7.5% from the prior year.
Liquidity & Cash Flow
At the end of December 2023, Adtalem had cash and cash equivalents of $182.9 million, compared with $273.7 million at the end of fiscal 2023. Additionally, the company’s net debt to adjusted EBITDA ratio was 1.5x at the end of December 2023.
Raised Fiscal 2024 Guidance
The company has increased its revenue expectations for fiscal 2024 to a range of $1,520-$1,560 million, up from the prior forecast of $1,470-$1,530 million. Moreover, adjusted EPS is anticipated to be in the range of $4.55-$4.75 per share, higher than the previous estimate of $4.25-$4.45 per share.
Zacks Rank & Key Picks
Adtalem currently holds a Zacks Rank #3 (Hold). Some noteworthy stocks in the Zacks Consumer Discretionary sector include H World Group Limited (HTHT), Atour Lifestyle Holdings Limited (ATAT), and Netflix, Inc. (NFLX).
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Source: Zacks Investment Research
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