Perdoceo Education (PRDO) AI Stock Analysis

• Market Cap: $1.73B
• Dividend Yield: 1.91%
• Average Volume (3M): 704.75K
• Price to Earnings (P/E): 11.9
• Beta (1Y): 0.31
• Revenue Growth: -4.05%
• EPS Growth: 1.50%
• Country: US
• Employees: 5,690
• Sector: Consumer Cyclical
• Sector Strength: 62
• Industry: Education & Training Services
• EPS (TTM): 2.20
• Shares Outstanding: 65,914,276
• 10 Day Avg. Volume: 625,746
• 30 Day Avg. Volume: 704,755
• PEG Ratio: 7.94
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.38
• Price to Cash Flow (P/CF): 23.00
• P/FCF Ratio: 22.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $35.00
• Price Target Upside: 35.82% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

Perdoceo Education's stock is well-supported by strong financial health, evidenced by high profitability and solid balance sheet metrics. Valuation metrics indicate potential undervaluation, and strategic acquisitions and enrollment growth are promising for future performance. However, technical analysis shows mixed signals, and challenges from student loan changes could impact growth. Overall, the stock presents a balanced risk-reward profile with strong fundamentals.

Positive Factors

Acquisition Impact

Perdoceo Education completed the acquisition of the University of St. Augustine for Health Sciences, expected to be immediately accretive to adjusted operating income beginning in 2025.

Financial Guidance

Management's initial guidance for 2025 calls for adjusted operating income and EPS above analyst estimates.

Stock Valuation

Perdoceo's shares trade at a significant discount to its postsecondary education peer group average, representing a potential upside.

Negative Factors

Revenue Decrease

Revenue in the third quarter decreased 5.6% to $169.8 million due to lower revenue from CTU and AIUS, related to a lag impact from operational changes in the prior year.

Perdoceo Education Business Overview & Revenue Model

Company Description

Perdoceo Education Corporation (PRDO) is a provider of postsecondary education programs primarily in North America. The company operates through its accredited institutions, including the American InterContinental University and Colorado Technical University. These universities offer a wide range of degree programs, from associate to doctoral levels, across various fields such as business, information technology, healthcare, and criminal justice. Perdoceo Education focuses on delivering online and campus-based education services, catering to a diverse student population with flexible learning options.

How the Company Makes Money

Perdoceo Education Corporation generates revenue primarily through tuition fees paid by students enrolled in its degree programs. The company offers a variety of financial aid options and scholarships to support student enrollment, which in turn drives its revenue streams. Additionally, Perdoceo may receive funding from federal financial aid programs, including Title IV funds, which are critical to its business model. The company also leverages partnerships with employers and industry organizations to enhance its educational offerings and attract more students, further contributing to its earnings.

Perdoceo Education Financial Statement Overview

Summary

Perdoceo Education demonstrates strong financial health, with stable revenue growth, high profitability margins, and a solid balance sheet characterized by low debt and high return on equity. Robust cash flow generation further supports its financial stability, enabling growth opportunities.

Income Statement

Perdoceo Education has demonstrated strong financial performance with consistent revenue growth over the past few years. The gross profit margin remains robust at 100% due to the absence of cost of goods sold reported. The net profit margin improved slightly despite a decrease in total revenue from the previous year, reflecting efficient cost management and operational efficiency. EBIT and EBITDA margins are healthy, indicating solid core business profitability.

Balance Sheet

The company's balance sheet is strong, with a low debt-to-equity ratio, reflecting low leverage and financial stability. The return on equity is high, indicating effective utilization of shareholder capital to generate profits. The equity ratio is also healthy, emphasizing financial stability and a strong asset base compared to liabilities.

Cash Flow

Perdoceo Education's cash flow is robust, with significant growth in free cash flow, driven by strong operating cash flow generation. The operating cash flow to net income and free cash flow to net income ratios are favorable, highlighting efficient cash generation from operations relative to net income.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
681.26M	710.00M	695.21M	693.03M	687.31M
	Gross Profit
681.26M	579.68M	578.49M	584.29M	575.55M
	EBIT
174.25M	150.45M	129.64M	149.02M	142.93M
	EBITDA
215.47M	209.41M	152.37M	165.78M	158.33M
	Net Income Common Stockholders
147.59M	147.65M	95.87M	109.64M	124.26M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
568.92M	603.14M	508.72M	494.19M	406.36M
	Total Assets
1.24B	1.01B	957.37M	847.43M	721.52M
	Total Debt
75.04M	27.05M	33.84M	44.95M	53.19M
	Net Debt
-625.64M	-90.96M	-75.57M	-275.03M	-52.49M
	Total Liabilities
277.50M	165.90M	231.52M	197.32M	165.61M
	Stockholders Equity
959.54M	841.42M	725.85M	650.11M	555.91M
Cash Flow		Free Cash Flow
156.97M	105.61M	135.57M	180.66M	170.19M
	Operating Cash Flow
161.59M	112.03M	148.19M	191.12M	179.96M
	Investing Cash Flow
-107.78M	-88.51M	-326.75M	54.32M	-165.91M
	Financing Cash Flow
-41.08M	-23.38M	-27.73M	-29.95M	-13.05M

Perdoceo Education Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 25.77
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRDO, the sentiment is Positive. The current price of 25.77 is above the 20-day moving average (MA) of 25.30, below the 50-day MA of 26.19, and above the 200-day MA of 24.30, indicating a neutral trend. The MACD of -0.28 indicates Negative momentum. The RSI at 46.78 is Neutral, neither overbought nor oversold. The STOCH value of 81.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PRDO.

Perdoceo Education Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATGE	82 Outperform	$3.97B	19.16	14.63%	―	12.83%	97.16%
PRDO	78 Outperform	$1.73B	11.94	16.39%	1.91%	-4.05%	1.50%
UTI	72 Outperform	$1.50B	27.67	21.41%	―	14.70%	275.89%
APEI	68 Neutral	$432.98M	43.12	5.41%	―	4.00%	―
STRA	68 Neutral	$1.94B	16.85	6.80%	3.05%	7.68%	61.28%
Sector *	59 Neutral	$11.38B	10.18	-0.84%	4.04%	1.25%	-16.04%
LINC	57 Neutral	$530.76M	51.78	5.73%	―	16.40%	-62.64%

Perdoceo Education Corporate Events

Perdoceo Education Approves 2025 Annual Incentive Plan

On March 6, 2025, Perdoceo Education Corporation’s Compensation Committee approved the 2025 Annual Incentive Plan, which mirrors the 2024 plan in structure, focusing on adjusted operating income and individual goals for senior executives. Additionally, the committee approved salary and incentive adjustments for key executives, including a 6.25% salary increase for CEO Todd Nelson and a 20% increase in the Long-Term Incentive target for CFO Ashish Ghia.

Perdoceo Education Expands Board with Strategic Appointment

On February 3, 2025, Perdoceo Education Corporation expanded its Board of Directors from eight to nine members, appointing Hanna Skandera to fill the new position. Skandera, known for her leadership in education and policy, brings extensive experience to the board, having previously served in various high-profile education roles, including as Secretary of Education in New Mexico. Her appointment is seen as a strategic move to strengthen the company’s board with her insights and expertise, potentially impacting its operations and positioning in the education sector.