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American Public (APEI) Q4 Earnings & Revenues Miss Estimates
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American Public Education, Inc. (APEI - Free Report) reported dismal results for fourth-quarter 2022. The top and the bottom lines missed the Zacks Consensus Estimate. Low contributions and increased expenses from the RU segment and the inclusion of GSUSA’s cost and expenses negatively impacted the company’s performance during the quarter
Delving Deeper
The company reported an adjusted loss of 27 cents per share, wider than the consensus mark of a loss of 18 cents. In the prior-year quarter, the company had reported adjusted earnings of 50 cents per share. The decline was mainly due to lower contributions from the RU segment.
Total revenues of $152.4 million missed the consensus mark of $153 million by almost 0.2% and also declined 1% from the year-ago period’s levels. The downside was due to costs and expenses of GSUSA (included from this quarter) and the RU segment.
American Public Education, Inc. Price, Consensus and EPS Surprise
Total costs and expenses increased 11.1% year over year to $152.7 million due to the inclusion of RU and GSUSA. Adjusted EBITDA declined 47.4% year over year to $15.4 million.
Segment Discussion
The company now operates in three segments, namely, the American Public University System (“APUS”), RU and Hondros College of Nursing segment (“HCN”).
APUS: Revenues of $73.4 million were on par with the year-ago period’s levels. APUS total net course registration increased 1% from the year-ago period’s levels to 87,200 in the fourth quarter, driven by strong active-duty enrollment. In the quarter, military registrations were up 4% and army registrations rose 7%.
RU: The segment reported revenues of $60.7 million for the quarter, down from $68.4 million reported a year ago. RU’s total student enrollment fell 9% from the prior-year period’s levels to 15,600 due to 23% collective decline in both nursing and non-nursing enrollment.
HCN: Segment’s revenues inched up 3% year over year to $12.6 million. Total student enrollment at HCN increased 4% from the prior-year quarter’s levels to 2,600.
Financials
As of Dec 31, 2022, American Public had total unrestricted cash and cash equivalents of $102.6 million compared with $122.6 million at the 2021-end.
Q1 Guidance
In first-quarter 2023, APEI expects total revenues to be flat to up 2% and be in the range of $155.1-$157.1 million. In the same quarter it anticipates adjusted loss in the range of 44-51 cents per share. Adjusted EBITDA is anticipated to be between $2.4 million and $4.1 million, suggesting a decline of 86-76% year over year.
APUS total net course registrations are likely to be approximately 96,300, implying growth of 2.4% year over year. HCN’s total student enrollment is expected to increase 10% to 2,700. RU’s student enrollment is likely to fall 12% to 14,300. Nursing student enrollment is likely to fall 19% to 6,800. Non-nursing student enrollment is expected to decline 4% year over year to 7,500.
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American Public (APEI) Q4 Earnings & Revenues Miss Estimates
American Public Education, Inc. (APEI - Free Report) reported dismal results for fourth-quarter 2022. The top and the bottom lines missed the Zacks Consensus Estimate. Low contributions and increased expenses from the RU segment and the inclusion of GSUSA’s cost and expenses negatively impacted the company’s performance during the quarter
Delving Deeper
The company reported an adjusted loss of 27 cents per share, wider than the consensus mark of a loss of 18 cents. In the prior-year quarter, the company had reported adjusted earnings of 50 cents per share. The decline was mainly due to lower contributions from the RU segment.
Total revenues of $152.4 million missed the consensus mark of $153 million by almost 0.2% and also declined 1% from the year-ago period’s levels. The downside was due to costs and expenses of GSUSA (included from this quarter) and the RU segment.
American Public Education, Inc. Price, Consensus and EPS Surprise
American Public Education, Inc. price-consensus-eps-surprise-chart | American Public Education, Inc. Quote
Total costs and expenses increased 11.1% year over year to $152.7 million due to the inclusion of RU and GSUSA. Adjusted EBITDA declined 47.4% year over year to $15.4 million.
Segment Discussion
The company now operates in three segments, namely, the American Public University System (“APUS”), RU and Hondros College of Nursing segment (“HCN”).
APUS: Revenues of $73.4 million were on par with the year-ago period’s levels. APUS total net course registration increased 1% from the year-ago period’s levels to 87,200 in the fourth quarter, driven by strong active-duty enrollment. In the quarter, military registrations were up 4% and army registrations rose 7%.
RU: The segment reported revenues of $60.7 million for the quarter, down from $68.4 million reported a year ago. RU’s total student enrollment fell 9% from the prior-year period’s levels to 15,600 due to 23% collective decline in both nursing and non-nursing enrollment.
HCN: Segment’s revenues inched up 3% year over year to $12.6 million. Total student enrollment at HCN increased 4% from the prior-year quarter’s levels to 2,600.
Financials
As of Dec 31, 2022, American Public had total unrestricted cash and cash equivalents of $102.6 million compared with $122.6 million at the 2021-end.
Q1 Guidance
In first-quarter 2023, APEI expects total revenues to be flat to up 2% and be in the range of $155.1-$157.1 million. In the same quarter it anticipates adjusted loss in the range of 44-51 cents per share. Adjusted EBITDA is anticipated to be between $2.4 million and $4.1 million, suggesting a decline of 86-76% year over year.
APUS total net course registrations are likely to be approximately 96,300, implying growth of 2.4% year over year. HCN’s total student enrollment is expected to increase 10% to 2,700. RU’s student enrollment is likely to fall 12% to 14,300. Nursing student enrollment is likely to fall 19% to 6,800. Non-nursing student enrollment is expected to decline 4% year over year to 7,500.
Zacks Rank & Key Picks
American Public currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Here are some better-ranked stocks that investors may consider in the Zacks Consumer Discretionary sector.
Ralph Lauren Corporation (RL - Free Report) currently sports a Zacks Rank #1. RL delivered a trailing four-quarter earnings surprise of 23.6% on average. Its shares have rallied 19.6% in the past six months.
The Zacks Consensus Estimate for RL’s fiscal 2024 sales and EPS suggests growth of 5.5% and 14%, respectively, from the year-ago levels.
InterContinental Hotels Group PLC (IHG - Free Report) currently carries a Zacks Rank #2 (Buy). Shares of IHG have gained 25% in the past six months. The long-term earnings growth rate of the company is 13.6%.
The Zacks Consensus Estimate for IHG’s 2023 sales and EPS suggests growth of 9.8% and 18.4%, respectively, from the year-ago period’s reported levels.
Sony Group Corporation (SONY - Free Report) currently has a Zacks Rank #2. SONY has a trailing four-quarter earnings surprise of 22.2% on average. Shares of the company have gained 18.9% in the past six months.
The Zacks Consensus Estimate for SONY’s fiscal 2024 sales and EPS suggests growth of 10.3% and 7.9%, respectively.