雅虎香港財經 Adtalem (ATGE) Q3 Earnings Top Estimates, 2024 Guidance Up
Adtalem Global Education Inc. ATGE reported impressive results for third-quarter fiscal 2024, wherein earnings and revenues surpassed their respective Zacks Consensus Estimate. Also, both metrics increased year over year.
Revenue growth and operational efficiencies, which were partially offset by investments in Growth with Purpose initiatives, helped ATGE post solid margins. Impressively, its Growth with Purpose strategy allowed the company to expand access to high-quality, in-demand programs.
Earnings, Revenues & Margins Discussion
Adjusted earnings per share (EPS) of $1.50 topped the consensus mark of $1.15 by 30.4% and surged 32.7% from $1.13 in the year-ago quarter.
Adtalem Global Education Inc. Price, Consensus and EPS Surprise
Adtalem Global Education Inc. price-consensus-eps-surprise-chart | Adtalem Global Education Inc. Quote
Revenues of $412.7 million beat the consensus mark of $392 million by 5.3% and increased 11.8% year over year. For the fiscal third quarter, enrollment of total students rose 7.8% year over year to 85,809.
Adjusted operating income rose 23% from the prior-year quarter’s levels to $89.8 million. Adjusted operating margin increased 200 basis points (bps) to 21.8%.
Adjusted EBITDA was $107.1 million, up 24.6% from the prior-year quarter’s levels. Adjusted EBITDA margin expanded 260 bps to 25.9% year over year.
Segment Details
Chamberlain: Revenues in the segment were up 13.8% from the year-ago quarter’s levels, totaling $170.3 million. Total student enrollment increased 9% to 37,985 students, driven by growth in pre-licensure and post-licensure nursing programs as well as high persistence.
Adjusted operating income grew 9.5% from the prior-year quarter’s levels to $43.3 million. Adjusted operating margin, however, contracted 100 bps to 25.4%.
Adjusted EBITDA was $50.5 million, up 12.3% from the prior-year quarter’s levels. Adjusted EBITDA margins, however, fell 40 bps to 29.6% due to increased investments in marketing, student support services to enhance academic outcomes and other costs.
Walden: The segment generated revenues of $150.6 million, which grew 13.3% year over year. Total student enrollment in the quarter increased 8.4% year over year to 42,751 students. This was backed by growth in healthcare, slightly offset by non-healthcare programs as well as high persistence.
Adjusted operating income came in at $31.9 million, up 29.4% from a year ago. Adjusted operating margin expanded 270 basis points to 21.2%.
Adjusted EBITDA was $35.9 million, up 28.9% from the prior-year period’s levels. Adjusted EBITDA margins improved 290 bps to 23.8%.
Medical and Veterinary: Revenues in the segment increased 6.1% to $91.7 million from the year-ago quarter’s figure. Total student enrollment, however, fell 4.5% from the prior-year quarter’s levels to 5,073 students due to declines at the medical schools.
Adjusted operating income increased 35.9% from the prior-year quarter’s figure to $23 million. Adjusted operating margin expanded 550 basis points to 25%.
Adjusted EBITDA was $27 million, up 30.3% from the prior-year quarter’s levels. Adjusted EBITDA margins surged 540 bps to 29.4%.
Liquidity & Cash Flow
As of Mar 31, 2024, Adtalem had cash and cash equivalents of $179.8 million compared with $273.7 million at the end of fiscal 2023. Long-term debt was $648.1 million, down from $695.1 million at the end of fiscal 2023. Trailing 12-month net debt to adjusted EBITDA was 1.3x at March 2024-end versus 1.5x at 2023-end.
For the first nine months of fiscal 2024, net cash provided by operating activities (continuing operations) totaled $246.8 million compared with $149.8 million in the year-ago period. Free cash flow in the quarter was $142.1 million compared with $98.2 million a year ago.
Raised Fiscal 2024 Guidance
Adtalem now expects revenues in the range of $1.56-$1.58 billion, up from the prior expectation of $1.52-$1.56 billion. The updated guidance is up from the prior-year figure of $1.45 billion.
Adjusted EPS is now expected to be in the range of $4.80-$5.00 per share, up from the prior estimate of $4.55-$4.75. In the year-ago period, the company reported an adjusted EPS of $4.21.
Zacks Rank
Adtalem currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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