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American Public (APEI) Q2 Earnings & Revenues Top, Down Y/Y
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American Public Education, Inc. (APEI - Free Report) reported better-than-expected second-quarter 2023 results with earnings and revenues surpassing the Zacks Consensus Estimate. However, both metrics declined on a year-over-year basis.
The company’s results benefited from the solid contributions of the American Public University System (APUS) and Hondros College of Nursing segment (HCN) segments’ as well as Graduate School USA revenues included in Corporate and Other, and cost-saving initiatives.
Following the results, the shares of this post-secondary education provider jumped 2.42% in the after-hours trading session on Aug 8. APEI exceeded the adjusted EBITDA guidance of $4.4-$6.4 million by 38%.
Delving Deeper
The company reported an adjusted loss of 25 cents per share, narrower than the Zacks Consensus Estimate of a loss of 31 cents per share by 19.4%. In the year-ago quarter, APEI reported an adjusted loss of 6 cents per share.
Total revenues of $147.2 million topped the consensus mark of $146.2 million by 0.7% but decreased 1.6% from the year-ago period’s levels. The dismal performance of the Rasmussen University (RU) segment ailed the other segments’ tailwind.
American Public Education, Inc. Price, Consensus and EPS Surprise
Total costs and expenses (excluding impairment charges) increased 1.7% to $148.5 million year over year, owing to increased employee compensation costs, bad debt expenses, building rent and maintenance costs, along with technology costs, partially offset by a decrease in advertising costs. Excluding impairment charges, costs and expenses were 100.9% of total revenues in the second quarter of 2023, up from 97.6% of revenues reported in the prior-year period.
Adjusted EBITDA declined 39.6% year over year to $8.8 million. Adjusted EBITDA margin of 6% contracted 400 bps year over year.
Segment Discussion
APUS: Revenues of $73.6 million rose 5.2% from the year-ago period’s levels of $69.9 million. For this segment’s revenues, our model predicted a value of $71.3 million or 2% year-over-year growth, comparatively lower than the reported value.
APUS’ total net course registration increased 5.7% from second-quarter 2022 to 88,300. The upside was backed by increases in military registrations from students utilizing TA.
RU: The segment reported revenues of $52 million for the quarter, down 18.7% from $63.9 million reported a year ago due to lower nursing enrollment. On the other hand, we projected a year-over-year revenue decline of 13.2% to $55.5 million for this segment.
RU’s total student enrollment fell 12.6% from the prior-year period’s levels to 13,900 due to a 21.9% decline in nursing and a 2.6% decline in non-nursing enrollment.
HCN: Segment’s revenues for the quarter rose 24.2% year over year to $14.3 million, compared with our projection of 23.3% growth to $14.2 million year over year.
Total student enrollment at HCN increased 23% from the prior-year quarter’s levels to 3,000, marking an all-time high. The upside was backed by enrollment growth in recently opened campuses, which include the opening of the Detroit, MI campus in October 2022.
Financials
At the end of second-quarter 2023, American Public had total cash and cash equivalents of $139.4 million, up from $129.5 million at 2022 end.
Q3 Guidance
APEI expects total revenues to range between -1% and 1% year over year to between $148.3 million and $150.3 million. It anticipates an adjusted loss of 32-24 cents per share, compared with the loss of 20 cents per share reported a year ago. Adjusted EBITDA is expected to be within $8.4-$10.4 million, compared with $9.5 million reported in the prior-year quarter.
APUS’ total net course registrations are likely to be between 90,500 and 92,500, reflecting growth of 6-8% year over year. HCN’s total enrollment is expected to increase 17% from the prior year’s tally to 2,800 students. RU’s student enrollment will likely fall 10% from the year-ago quarter’s figure to 13,500. Nursing student enrollment is likely to fall 25% to 5,700 while non-nursing student enrollment is expected to increase 5% to 7,700, year over year.
MGM Resorts International (MGM - Free Report) reported impressive second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Both metrics surpassed the consensus estimate for the third consecutive quarter. Moreover, the top and bottom lines increased on a year-over-year basis.
MGM’s upside was primarily driven by growth in business volume and travel activity, primarily at MGM China and Las Vegas Strip Resorts.
Caesars Entertainment, Inc. (CZR - Free Report) reported solid second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis.
Despite a tough year-over-year comparison, CZR benefited from strong leisure and casino demand in Las Vegas and solid digital segment performance. Also, improved marketing capabilities and capital projects delivered solid returns.
Hasbro, Inc. (HAS - Free Report) reported mixed second-quarter fiscal 2023 results, with earnings missing the Zacks Consensus Estimate and revenues beating the same. The metrics declined on a year-over-year basis. Dismal performances of Franchise Brands, Partner Brands and Portfolio Brands affected the top line.
The company announced the sale of its eOne Film and TV business to Lionsgate for approximately $500 million. The company anticipates the deal to strengthen its financial flexibility and retire its floating rate debt (by approximately $400 million). The company expects to close the deal by 2023-end.
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American Public (APEI) Q2 Earnings & Revenues Top, Down Y/Y
American Public Education, Inc. (APEI - Free Report) reported better-than-expected second-quarter 2023 results with earnings and revenues surpassing the Zacks Consensus Estimate. However, both metrics declined on a year-over-year basis.
The company’s results benefited from the solid contributions of the American Public University System (APUS) and Hondros College of Nursing segment (HCN) segments’ as well as Graduate School USA revenues included in Corporate and Other, and cost-saving initiatives.
Following the results, the shares of this post-secondary education provider jumped 2.42% in the after-hours trading session on Aug 8. APEI exceeded the adjusted EBITDA guidance of $4.4-$6.4 million by 38%.
Delving Deeper
The company reported an adjusted loss of 25 cents per share, narrower than the Zacks Consensus Estimate of a loss of 31 cents per share by 19.4%. In the year-ago quarter, APEI reported an adjusted loss of 6 cents per share.
Total revenues of $147.2 million topped the consensus mark of $146.2 million by 0.7% but decreased 1.6% from the year-ago period’s levels. The dismal performance of the Rasmussen University (RU) segment ailed the other segments’ tailwind.
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 (excluding impairment charges) increased 1.7% to $148.5 million year over year, owing to increased employee compensation costs, bad debt expenses, building rent and maintenance costs, along with technology costs, partially offset by a decrease in advertising costs. Excluding impairment charges, costs and expenses were 100.9% of total revenues in the second quarter of 2023, up from 97.6% of revenues reported in the prior-year period.
Adjusted EBITDA declined 39.6% year over year to $8.8 million. Adjusted EBITDA margin of 6% contracted 400 bps year over year.
Segment Discussion
APUS: Revenues of $73.6 million rose 5.2% from the year-ago period’s levels of $69.9 million. For this segment’s revenues, our model predicted a value of $71.3 million or 2% year-over-year growth, comparatively lower than the reported value.
APUS’ total net course registration increased 5.7% from second-quarter 2022 to 88,300. The upside was backed by increases in military registrations from students utilizing TA.
RU: The segment reported revenues of $52 million for the quarter, down 18.7% from $63.9 million reported a year ago due to lower nursing enrollment. On the other hand, we projected a year-over-year revenue decline of 13.2% to $55.5 million for this segment.
RU’s total student enrollment fell 12.6% from the prior-year period’s levels to 13,900 due to a 21.9% decline in nursing and a 2.6% decline in non-nursing enrollment.
HCN: Segment’s revenues for the quarter rose 24.2% year over year to $14.3 million, compared with our projection of 23.3% growth to $14.2 million year over year.
Total student enrollment at HCN increased 23% from the prior-year quarter’s levels to 3,000, marking an all-time high. The upside was backed by enrollment growth in recently opened campuses, which include the opening of the Detroit, MI campus in October 2022.
Financials
At the end of second-quarter 2023, American Public had total cash and cash equivalents of $139.4 million, up from $129.5 million at 2022 end.
Q3 Guidance
APEI expects total revenues to range between -1% and 1% year over year to between $148.3 million and $150.3 million. It anticipates an adjusted loss of 32-24 cents per share, compared with the loss of 20 cents per share reported a year ago. Adjusted EBITDA is expected to be within $8.4-$10.4 million, compared with $9.5 million reported in the prior-year quarter.
APUS’ total net course registrations are likely to be between 90,500 and 92,500, reflecting growth of 6-8% year over year. HCN’s total enrollment is expected to increase 17% from the prior year’s tally to 2,800 students. RU’s student enrollment will likely fall 10% from the year-ago quarter’s figure to 13,500. Nursing student enrollment is likely to fall 25% to 5,700 while non-nursing student enrollment is expected to increase 5% to 7,700, year over year.
Zacks Rank
American Public currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Consumer Discretionary Releases
MGM Resorts International (MGM - Free Report) reported impressive second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Both metrics surpassed the consensus estimate for the third consecutive quarter. Moreover, the top and bottom lines increased on a year-over-year basis.
MGM’s upside was primarily driven by growth in business volume and travel activity, primarily at MGM China and Las Vegas Strip Resorts.
Caesars Entertainment, Inc. (CZR - Free Report) reported solid second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis.
Despite a tough year-over-year comparison, CZR benefited from strong leisure and casino demand in Las Vegas and solid digital segment performance. Also, improved marketing capabilities and capital projects delivered solid returns.
Hasbro, Inc. (HAS - Free Report) reported mixed second-quarter fiscal 2023 results, with earnings missing the Zacks Consensus Estimate and revenues beating the same. The metrics declined on a year-over-year basis. Dismal performances of Franchise Brands, Partner Brands and Portfolio Brands affected the top line.
The company announced the sale of its eOne Film and TV business to Lionsgate for approximately $500 million. The company anticipates the deal to strengthen its financial flexibility and retire its floating rate debt (by approximately $400 million). The company expects to close the deal by 2023-end.