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Universal Technical (UTI) Reports Wider-Than-Expected Q3 Loss
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Universal Technical Institute, Inc. (UTI - Free Report) recently reported fiscal third-quarter 2018 results.
Adjusted loss of 52 cents per share in the fiscal third quarter was wider than the Zacks Consensus Estimate of 48 cents and the year-ago quarter’s 21 cents.
Quarterly revenues of $74.9 million beat the consensus mark of $74 million by 1.2%. However, revenues declined 1.8% from the prior-year quarter due to a 5.1% drop in average student enrollment.
Total starts dropped 12.7% year over year to 1,548 during the quarter.
Universal Technical Institute Inc Price, Consensus and EPS Surprise
Operating expenses rose 9.7% to $86.7 million, driven by an increase in contract services, advertising, goodwill and intangible asset impairment expense, compensation and occupancy costs.
Operating loss in the quarter was $11.8 million compared with $2.8 million in the prior-year quarter.
Earnings (loss) before interest, taxes, depreciation and amortization (EBITDA) were $(7.2) million compared with $2.1 million a year ago.
Financials
The company had cash and cash equivalents of nearly $60 million as of Jun 30, 2018 compared with $50.1 million on Sep 30, 2017.
Net cash used in operations came in at $22.4 million in the first nine months of 2018 compared with $29.8 million recorded in the comparable period last year.
Fiscal 2018 Outlook
UTI expects new student starts growth in mid-single digits year over year. The average student population is likely to decline in mid-single digits.
Revenues are expected in the range of $315-$320 million for the fiscal.
Operating expenses are projected in the range of $352-$354 million.
UTI expects to incur operating loss between $32 million and $36 million, as well as projects a negative EBITDA.
Capital expenditures are expected between $23 million and $24 million for the fiscal.
Share Price Performance
UTI has outperformed its industry so far this year. The stock has gained around 28.8% against its industry’s collective decline of 0.4% in the said period.
Zacks Rank & Key Picks
Universal Technical currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same space are Bridgepoint Education, Inc. , Strategic Education, Inc. (STRA - Free Report) and RYB Education, Inc. . While Bridgepoint and Strategic Education sport a Zacks Rank #1 (Strong Buy), RYB Education carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bridgepoint Education and Strategic Education’s earnings for 2018 are expected to grow 8.5% and 52.4%, respectively. RYB Education’s earnings for 2019 are anticipated to grow 141.2%.
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Universal Technical (UTI) Reports Wider-Than-Expected Q3 Loss
Universal Technical Institute, Inc. (UTI - Free Report) recently reported fiscal third-quarter 2018 results.
Adjusted loss of 52 cents per share in the fiscal third quarter was wider than the Zacks Consensus Estimate of 48 cents and the year-ago quarter’s 21 cents.
Quarterly revenues of $74.9 million beat the consensus mark of $74 million by 1.2%. However, revenues declined 1.8% from the prior-year quarter due to a 5.1% drop in average student enrollment.
Total starts dropped 12.7% year over year to 1,548 during the quarter.
Universal Technical Institute Inc Price, Consensus and EPS Surprise
Universal Technical Institute Inc Price, Consensus and EPS Surprise | Universal Technical Institute Inc Quote
Operating Highlights
Operating expenses rose 9.7% to $86.7 million, driven by an increase in contract services, advertising, goodwill and intangible asset impairment expense, compensation and occupancy costs.
Operating loss in the quarter was $11.8 million compared with $2.8 million in the prior-year quarter.
Earnings (loss) before interest, taxes, depreciation and amortization (EBITDA) were $(7.2) million compared with $2.1 million a year ago.
Financials
The company had cash and cash equivalents of nearly $60 million as of Jun 30, 2018 compared with $50.1 million on Sep 30, 2017.
Net cash used in operations came in at $22.4 million in the first nine months of 2018 compared with $29.8 million recorded in the comparable period last year.
Fiscal 2018 Outlook
UTI expects new student starts growth in mid-single digits year over year. The average student population is likely to decline in mid-single digits.
Revenues are expected in the range of $315-$320 million for the fiscal.
Operating expenses are projected in the range of $352-$354 million.
UTI expects to incur operating loss between $32 million and $36 million, as well as projects a negative EBITDA.
Capital expenditures are expected between $23 million and $24 million for the fiscal.
Share Price Performance
UTI has outperformed its industry so far this year. The stock has gained around 28.8% against its industry’s collective decline of 0.4% in the said period.
Zacks Rank & Key Picks
Universal Technical currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same space are Bridgepoint Education, Inc. , Strategic Education, Inc. (STRA - Free Report) and RYB Education, Inc. . While Bridgepoint and Strategic Education sport a Zacks Rank #1 (Strong Buy), RYB Education carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bridgepoint Education and Strategic Education’s earnings for 2018 are expected to grow 8.5% and 52.4%, respectively. RYB Education’s earnings for 2019 are anticipated to grow 141.2%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>