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Adtalem (ATGE) to Report Q4 Earnings: What's in the Cards?

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Adtalem Global Education Inc. (ATGE - Free Report) is scheduled to report fourth-quarter fiscal 2021 (ended Jun 30, 2021) results on Aug 19, after the closing bell.

In the last reported quarter, the top line lagged the Zacks Consensus Estimate by 0.9% but the bottom line topped the same by 2.9%. On the contrary, earnings declined 11.1% from the year-ago period due to COVID-related disruptions but revenues increased 3.4%.

Trend in Estimate Revision

The Zacks Consensus Estimate for earnings for the quarter to be reported has declined to 70 cents per share over the past 30 days. The said figure indicates a 20.7% increase from the year-ago earnings of 58 cents per share. The consensus mark for revenues is $284 million, suggesting a 9.3% year-over-year rise.

Factors at Play

Adtalem is expected to have witnessed strong revenues and earnings in the fiscal fourth quarter, as it has been witnessing solid demand across businesses driven by strength in student outcomes along with solid investments in marketing and new offerings. Yet, the company is expected to have witnessed an adverse impact on clinical weeks.

Its Financial Services segment is expected to have been impacted by increased sales and marketing expenses.

Nonetheless, the company has been undertaking initiatives to tackle the headwinds caused by the COVID-19 outbreak by controlling costs via increasing efficiency and reducing discretionary expenses. It has been gaining from solid competitive advantages arising from legacy of online learning and a streamlined business portfolio. Also, inorganic efforts are expected to have contributed to the top line, thereby offsetting the above-mentioned headwinds to some extent.

What the Zacks Model Says

Our proven model does not conclusively predict an earnings beat for Adtalem — which shares space with Strategic Education, Inc. (STRA - Free Report) , American Public Education, Inc. (APEI - Free Report) and Universal Technical Institute, Inc. (UTI - Free Report) in the Zacks Schools industry — this time around. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below.

Earnings ESP: Adtalem has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: It currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

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