Q3 Earnings Highs And Lows: Laureate Education (NASDAQ:LAUR) Vs The Rest Of The Education Services Stocks
Let’s dig into the relative performance of Laureate Education (NASDAQ:LAUR) and its peers as we unravel the now-completed Q3 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 Q3. As a group, revenues beat analysts’ consensus estimates by 2.2% while next quarter’s revenue guidance was in line.
Luckily, education services stocks have performed well with share prices up 10% on average since the latest earnings results.
Laureate Education (NASDAQ:LAUR)
Founded in 1998 by Douglas L. Becker and based in Miami, Laureate Education (NASDAQ:LAUR) is a global network of higher education institutions.
Laureate Education reported revenues of $368.6 million, up 2% year on year. This print exceeded analysts’ expectations by 1.9%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Eilif Serck-Hanssen, President and Chief Executive Officer, said “The macroeconomic recovery in Peru contributed to strong operating performance for the third quarter. We believe that we are well-positioned to meet our 2024 goals, with continued revenue growth and margin expansion across all markets. Our results demonstrate the resilience of our business model and the strength of our brands in Mexico and Peru, reinforcing our commitment to driving long-term value for all stakeholders.”
Laureate Education Total Revenue
Interestingly, the stock is up 20.7% since reporting and currently trades at $18.79.
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 $306 million, up 7% year on year, outperforming analysts’ expectations by 1.5%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ adjusted operating income estimates.
Strategic Education Total Revenue
The market seems content with the results as the stock is up 3.7% since reporting. It currently trades at $99.95.
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 $719.1 million, up 11.4% year on year, exceeding analysts’ expectations by 0.8%. Still, it was a mixed quarter as it posted full-year revenue guidance roughly in line wwth analysts’ expectations.
Bright Horizons delivered the weakest full-year guidance update in the group. As expected, the stock is down 10.6% since the results and currently trades at $118.68.
Established in 1946, Lincoln Educational (NASDAQ:LINC) is a provider of specialized technical training in the United States, offering career-oriented programs to provide practical skills required in the workforce.
Lincoln Educational reported revenues of $114.4 million, up 14.8% year on year. This number topped analysts’ expectations by 3.3%. It was a strong quarter as it also put up an impressive beat of analysts’ adjusted operating income estimates and full-year EBITDA guidance topping analysts’ expectations.
The stock is up 4.1% since reporting and currently trades at $16.88.
Formerly known as Career Education Corporation, Perdoceo Education (NASDAQ:PRDO) is an educational services company that specializes in postsecondary education.
Perdoceo Education reported revenues of $169.8 million, down 5.6% year on year. This number topped analysts’ expectations by 3.2%. Overall, it was a strong quarter as it also logged EPS guidance for next quarter beating analysts’ expectations and a decent beat of analysts’ EPS estimates.
Perdoceo Education had the slowest revenue growth among its peers. The stock is up 10.1% since reporting and currently trades at $27.36.
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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