Adtalem's Q2 Earnings & Revenues Top Estimates, 2025 View Up, Stock Up

Adtalem Global Education Inc. ATGE posted better-than-expected results in second-quarter fiscal 2025. Earnings and revenues surpassed the respective Zacks Consensus Estimate and increased year over year, driven by strong enrollment growth and strategic initiatives. Following the results, shares of this leading education provider gained 5% in the after-hours trading session yesterday.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Adtalem Global Education's operational excellence strategy, Growth with Purpose, has driven six consecutive quarters of enrollment growth while supporting its mission to develop skilled healthcare professionals. According to chairman and CEO, Steve Beard, the company’s focus on optimizing the student experience and prioritizing student outcomes has enabled it to scale critical care education successfully. Beard emphasized that these consistent and sustainable results have strengthened confidence in raising expectations for fiscal 2025.ATGE’s Earnings & Revenue DiscussionAdjusted earnings of $1.81 per share topped the consensus mark of $1.39 by 30.2% and increased 47.2% from $1.23 in the year-ago quarter.Revenues of $447.7 million beat the consensus mark of $429 million by 4.4% and increased 13.9% year over year. Strong demand at Chamberlain University and Walden University drove results.Adtalem Global Education Inc. Price, Consensus and EPS Surprise Adtalem Global Education Inc. price-consensus-eps-surprise-chart | Adtalem Global Education Inc. QuoteIn the fiscal second quarter, enrollment of total students rose 11.6% year over year to 91,264 students. Our Zacks model predicted a total student enrollment of 88,001 for the reported quarter.Adjusted operating income increased 34.2% from the prior-year quarter’s level to $75.6 million. Adjusted operating margin expanded 350 basis points (bps) to 22.7%.Adjusted EBITDA was $125 million, up 35.1% from the prior-year quarter’s level. Adjusted EBITDA margin expanded 440 bps to 27.9% year over year. We expected the adjusted EBITDA margin to be 23.9% for the reported quarter.ATGE's Segment DetailsChamberlain: Revenues in the segment were up 17.9% from the year-ago quarter’s level, totaling $181 million. Total student enrollment increased 11.5% to 39,691 students, driven by growth in pre-licensure and post-licensure nursing programs.Adjusted operating income increased 42.7% from the prior-year quarter’s level to $29.6 million. Adjusted operating margin expanded 410 bps to 23.4%. Adjusted EBITDA was $52.6 million, up 42.5% from the prior-year quarter’s level. Adjusted EBITDA margins expanded 510 bps to 29.1%.Walden: The segment generated revenues of $171.3 million, up 16.7% year over year. Total student enrollment in the quarter increased 13.2% year over year to 46,399 students, driven by growth in healthcare and non-healthcare programs.Adjusted operating income was $46.2 million, up 53.1% year over year. Adjusted operating margin expanded 640 bps to 27%. Adjusted EBITDA was $52.1 million, up 50.2% from the prior-year period’s level. Adjusted EBITDA margins increased 680 bps to 30.4%.Medical and Veterinary: Revenues in the segment increased 2.8% to $95.4 million from the year-ago quarter’s figure. Total student enrollment fell 0.7% from the prior-year quarter’s level to 5,174 students.Adjusted operating income decreased 2.6% from the prior-year quarter’s figure to $26.4 million. Adjusted operating margin contracted 130 bps to 22.5%. Adjusted EBITDA was $26.7 million, up 1.3% from the prior-year quarter’s level. Adjusted EBITDA margins decreased 40 bps to 28%.Liquidity & Cash Flow of ATGEAs of Dec. 31, 2024, Adtalem had cash and cash equivalents of $193.6 million compared with $219.3 million as of June 30, 2024. Long-term debt was $649.9 million, up from $648.7 million as of June 30, 2024.For the first six months of fiscal 2025, cash provided by operating activities (continuing operations) totaled $70.3 million, down from $81.9 million in the year-ago period. Free cash flow in the quarter was $188.9 million, down from $232.7 million a year ago.ATGE’s Fiscal 2025 Guidance RaisedFor fiscal 2025, ATGE now expects revenues in the range of $1,730-$1,760 million (compared with $1,690-$1,730 million expected earlier). It now expects adjusted earnings in the band of $6.10-$6.30 per share compared with the earlier prediction of $5.75 to $5.95.ATGE’s Zacks Rank & Key PicksAdtalem currently carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the Zacks Consumer Discretionary sector are:Trip.com Group Limited TCOM sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.TCOM delivered a trailing four-quarter earnings surprise of 42.8%, on average. The stock has gained 12.7% in the past three months. The Zacks Consensus Estimate for TCOM’s 2025 sales and EPS indicates growth of 15.1% and 7.4%, respectively, from the year-ago levels.JAKKS Pacific, Inc. JAKK currently sports a Zacks Rank #1. JAKK delivered a trailing four-quarter negative earnings surprise of 75.9%, on average. The stock has gained 1% in the past three months.The Zacks Consensus Estimate for JAKK’s 2025 sales indicates growth of 1.9% from the year-ago levels.Carnival Corporation & plc CCL currently carries a Zacks Rank #2 (Buy). CCL delivered a trailing four-quarter earnings surprise of 326.4%, on average. The stock has surged 26.8% in the past three months.The Zacks Consensus Estimate for CCL’s 2025 sales and EPS indicates growth of 4% and 23.9%, respectively, from the year-ago levels.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carnival Corporation (CCL): Free Stock Analysis Report JAKKS Pacific, Inc. (JAKK): Free Stock Analysis Report Adtalem Global Education Inc. (ATGE): Free Stock Analysis Report Trip.com Group Limited Sponsored ADR (TCOM): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks