Strayer Education Beats Estimates But Has a Big Earnings Drop

Strayer Education (Nasdaq: STRA  ) reported earnings on Feb. 14. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Strayer Education missed estimates on revenues and beat slightly on earnings per share.

Compared to the prior-year quarter, revenue dropped and GAAP earnings per share shrank significantly.

Margins dropped across the board.

Revenue details
Strayer Education tallied revenue of $141.9 million. The 15 analysts polled by S&P Capital IQ wanted to see revenue of $145.2 million on the same basis. GAAP reported sales were 8.9% lower than the prior-year quarter's $155.8 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.47. The 14 earnings estimates compiled by S&P Capital IQ averaged $1.44 per share. GAAP EPS of $1.47 for Q4 were 36% lower than the prior-year quarter's $2.31 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 45.3%, 820 basis points worse than the prior-year quarter. Operating margin was 20.2%, 890 basis points worse than the prior-year quarter. Net margin was 11.7%, 540 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $144.1 million. On the bottom line, the average EPS estimate is $1.59.

Next year's average estimate for revenue is $552.3 million. The average EPS estimate is $4.91.

Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 259 members out of 326 rating the stock outperform, and 67 members rating it underperform. Among 93 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 75 give Strayer Education a green thumbs-up, and 18 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Strayer Education is hold, with an average price target of $53.17.

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