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ATA Creativity Global (AACG)
NASDAQ:AACG
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ATA Creativity Global
(NASDAQ:AACG)
47Neutral
ATA Creativity Global (AACG) vs. S&P 500 (SPY)
Market Cap
$30.36M
Dividend YieldN/A
Average Volume (3M)55.83K
Price to Earnings (P/E)―
Beta (1Y)-0.05
Revenue Growth13.75%
EPS Growth3.00%
CountryUS
Employees581
SectorConsumer Cyclical
Sector Strength49
IndustryEducation
Share Statistics
EPS (TTM)-0.18
Shares Outstanding31,964,504
10 Day Avg. Volume98,372
30 Day Avg. Volume55,832
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.07
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
ATA Creativity Global Business Overview & Revenue Model
Company DescriptionATA Creativity Global (AACG) is an educational services company primarily focused on providing quality learning experiences and educational services in various creative arts and related fields. The company operates within the education and training sectors, offering a range of programs and services designed to enhance students' creativity and artistic skills. AACG is known for its commitment to delivering innovative and effective educational solutions in creative arts education.
How the Company Makes MoneyATA Creativity Global (AACG) generates revenue primarily through its comprehensive educational programs and services. The company offers a variety of courses and training programs focused on creative arts, including visual arts, design, and other related fields. Revenue is derived from tuition fees paid by students enrolled in these programs. Additionally, AACG may engage in partnerships with educational institutions and other organizations to expand its reach and enhance its offerings, contributing further to its earnings. The company may also offer consulting and ancillary services related to creative arts education, providing additional revenue streams.
ATA Creativity Global Financial Statement Overview
Summary
ATA Creativity Global shows revenue growth and improvements in cash flow management. However, persistent profitability issues, such as negative EBIT and net income, present significant challenges. The low leverage provides some financial stability, but the declining equity is concerning.Income Statement
The income statement shows some growth in total revenue, with a year-over-year increase of approximately 7.14% in 2023. However, the company has been consistently reporting negative EBIT and net income, indicating ongoing operational and profitability challenges. The gross profit margin has remained stable, but the negative net income margin highlights the company's struggle to control expenses and achieve profitability.45
Neutral
Balance Sheet
The balance sheet indicates a relatively low debt-to-equity ratio of 0.20, reflecting a conservative approach to leverage. However, stockholders' equity has decreased over the years, and the equity ratio stands at 25.18%, suggesting limited asset backing by equity. The overall financial stability is moderate, with a significant portion of assets financed by liabilities.50
Neutral
Cash Flow
The cash flow statement shows improvement in free cash flow from negative to positive in 2023, indicating enhanced cash management. The operating cash flow has also turned positive, which is a positive sign. However, the free cash flow to net income ratio and operating cash flow to net income ratio highlight challenges in translating profit into cash flow, given the negative net income.55
Neutral
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 242.95M | 221.62M | 206.82M | 202.21M | 162.17M | 97.77M | Gross Profit |
| 129.19M | 114.66M | 102.51M | 104.80M | 63.65M | 35.86M | EBIT |
| -41.19M | -41.50M | -56.59M | -66.39M | -104.36M | -108.84M | EBITDA |
| -30.04M | -19.51M | -34.00M | -43.36M | -74.44M | -91.29M | Net Income Common Stockholders |
| -33.40M | -33.66M | -48.59M | -36.41M | -100.58M | -134.01M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 190.59M | 60.17M | 54.98M | 71.34M | 112.72M | 154.20M | Total Assets |
| 335.13M | 448.94M | 474.46M | 507.18M | 575.62M | 667.65M | Total Debt |
| 0.00 | 22.61M | 36.45M | 40.72M | 47.78M | 25.55M | Net Debt |
| -190.59M | -37.56M | -18.53M | -30.62M | -64.94M | -128.65M | Total Liabilities |
| 19.75M | 335.97M | 330.95M | 316.28M | 327.87M | 317.02M | Stockholders Equity |
| 275.81M | 113.04M | 143.10M | 187.77M | 198.40M | 300.24M |
| Cash Flow | Free Cash Flow | ||||
| 0.00 | 6.51M | -16.23M | -36.29M | -32.78M | -59.16M | Operating Cash Flow |
| 0.00 | 8.75M | -14.61M | -31.83M | -27.87M | -57.88M | Investing Cash Flow |
| 0.00 | -3.97M | -2.49M | -10.03M | -19.09M | -36.95M | Financing Cash Flow |
| 0.00 | 403.44K | 188.21K | 827.52K | 6.30M | 57.57M |
ATA Creativity Global Technical Analysis
Positive
0.95
Price Trends
0.88
Positive
0.92
Positive
0.83
Positive
Market Momentum
0.03
Negative
53.58
Neutral
77.23
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AACG, the sentiment is Positive. The current price of 0.95 is above the 20-day moving average (MA) of 0.90, above the 50-day MA of 0.88, and above the 200-day MA of 0.83, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 53.58 is Neutral, neither overbought nor oversold. The STOCH value of 77.23 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AACG.
ATA Creativity Global Risk Analysis
ATA Creativity Global disclosed 64 risk factors in its most recent earnings report. ATA Creativity Global reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
ATA Creativity Global Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $5.26B | 20.19 | 22.95% | ― | 13.13% | 56.75% | |
74 Outperform | $8.01B | 20.79 | 10.40% | ― | 34.42% | 28.54% | |
72 Outperform | $7.82B | 66.51 | 3.23% | ― | 55.62% | ― | |
70 Outperform | $4.82B | 21.69 | 30.13% | ― | 7.50% | 13.70% | |
60 Neutral | $12.39B | 10.47 | 1.07% | 3.58% | 1.64% | -18.33% | |
47 Neutral | $30.36M | ― | -47.92% | ― | 13.75% | 3.00% | |
47 Neutral | $84.09M | ― | -147.16% | ― | -13.78% | -5297.96% |
* Consumer Cyclical Sector Average
Performance Comparison
AACG
ATA Creativity Global
0.95
-0.64
-40.25%
LOPE
Grand Canyon Education
168.05
35.57
26.85%
LRN
Stride
119.54
57.72
93.37%
EDU
New Oriental Education Tech
49.01
-39.58
-44.68%
CHGG
Chegg
0.77
-7.25
-90.40%
TAL
TAL Education Group
13.09
0.22
1.71%
ATA Creativity Global Earnings Call Summary
Earnings Call Date: Nov 7, 2024 | % Change Since: -9.52% | Next Earnings Date: Mar 26, 2025
Earnings Call Sentiment Neutral
The earnings call highlights significant growth in revenues and student enrollments driven by portfolio training services and new partnerships. However, increased costs have led to a decrease in gross margin and a widening net loss.Highlights
Double-Digit Revenue Growth
ACG reported a 13.1% increase in net revenues for Q3 2024 and a 21.1% increase for the first 9 months of 2024 compared to the same periods in 2023.
Increased Student Enrollment
Overall student enrollment rates increased by more than 20% for both Q3 2024 and the first 9 months of 2024 compared to 2023.
Expansion of Service Offerings
ACG expanded its services with new strategic partnerships and increased offerings in research-based learning and overseas study counseling.
Strong Portfolio Training Services
Portfolio training services remained the main revenue source, contributing more than 70% to total revenues.
Lowlights
Decreased Gross Margin
Gross margin decreased to 44.6% in Q3 2024 from 49.2% in Q3 2023, primarily due to higher costs related to teaching staff and outsourcing.
Increased Operating Expenses
Total operating expenses increased by 28.4% in Q3 2024, mainly due to higher sales and administrative costs.
Widening Net Loss
Net loss attributable to ACG increased to RMB 14.7 million in Q3 2024 from RMB 7.3 million in Q3 2023.
Company Guidance
During the third quarter of 2024, ATA Creativity Global (ACG) provided guidance on several financial and operational metrics. Total net revenue for Q3 was reported at RMB 67.3 million, a 13.1% increase from the prior year, driven largely by portfolio training and research-based learning services. Gross profit for the quarter stood at RMB 30 million, although the gross margin decreased to 44.6% from 49.2% due to higher staffing and outsourcing costs. Operating expenses rose by 28.4% to RMB 47.7 million, leading to a net loss of RMB 14.7 million. For the first nine months of 2024, net revenues increased by 21.1% to RMB 167.1 million, with gross profit rising by 24.6% to RMB 77.6 million. ACG's full-year revenue guidance for 2024 is projected to be between RMB 233 million and RMB 255 million, reflecting a 5% to 15% year-over-year increase. The company remains focused on portfolio training services as its primary growth driver, alongside expanding its educational offerings and international partnerships.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.