The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Career Education beat expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank significantly and GAAP earnings per share shrank to a loss.
Margins dropped across the board.
Career Education notched revenue of $332.8 million. The 10 analysts polled by S&P Capital IQ foresaw a top line of $324.4 million on the same basis. GAAP reported sales were 23% lower than the prior-year quarter's $431.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at -$0.47. The 10 earnings estimates compiled by S&P Capital IQ forecast -$0.43 per share. GAAP EPS were -$0.51 for Q3 against $0.14 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 60.0%, 390 basis points worse than the prior-year quarter. Operating margin was -14.5%, 1,820 basis points worse than the prior-year quarter. Net margin was -10.0%, 1,250 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $341.0 million. On the bottom line, the average EPS estimate is -$0.20.
Next year's average estimate for revenue is $1.47 billion. The average EPS estimate is -$0.32.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 166 members out of 201 rating the stock outperform, and 35 members rating it underperform. Among 50 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 39 give Career Education a green thumbs-up, and 11 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Career Education is hold, with an average price target of $3.96.
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