Lincoln Educational Services Corporation
Find Ratings ReportsLINCOLN EDUCATIONAL SERVICES's gross profit margin for the third quarter of its fiscal year 2020 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the subsector average, its revenue growth has not. LINCOLN EDUCATIONAL SERVICES has weak liquidity. Currently, the Quick Ratio is 0.86 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.
At the same time, stockholders' equity ("net worth") has greatly increased by 70.56% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.
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| Income Statement | Q3 FY20 | Q3 FY19 |
|---|---|---|
| Net Sales ($mil) | 79.29 | 72.59 |
| EBITDA ($mil) | 6.12 | 3.92 |
| EBIT ($mil) | 4.34 | 1.93 |
| Net Income ($mil) | 3.51 | 1.34 |
| Balance Sheet | Q3 FY20 | Q3 FY19 |
|---|---|---|
| Cash & Equiv. ($mil) | 27.59 | 15.75 |
| Total Assets ($mil) | 205.82 | 161.74 |
| Total Debt ($mil) | 81.23 | 71.93 |
| Equity ($mil) | 57.28 | 33.58 |
| Profitability | Q3 FY20 | Q3 FY19 |
|---|---|---|
| Gross Profit Margin | 59.05 | 56.98 |
| EBITDA Margin | 7.72 | 5.39 |
| Operating Margin | 5.47 | 2.66 |
| Sales Turnover | 1.39 | 1.67 |
| Return on Assets | 5.7 | -1.33 |
| Return on Equity | 17.48 | -6.43 |
| Debt | Q3 FY20 | Q3 FY19 |
|---|---|---|
| Current Ratio | 0.94 | 0.65 |
| Debt/Capital | 0.59 | 0.68 |
| Interest Expense | 0.28 | 0.76 |
| Interest Coverage | 15.61 | 2.56 |
| Share Data | Q3 FY20 | Q3 FY19 |
|---|---|---|
| Shares outstanding (mil) | 26.48 | 25.23 |
| Div / share | 0.0 | 0.0 |
| EPS | 0.08 | 0.05 |
| Book value / share | 2.16 | 1.33 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 148876.0 | 194744.0 |
BUY. LINCOLN EDUCATIONAL SERVICES's P/E ratio indicates a significant discount compared to an average of 54.96 for the Educational Services subsector and a significant discount compared to the S&P 500 average of 38.99. To use another comparison, its price-to-book ratio of 2.69 indicates a discount versus the S&P 500 average of 4.05 and a significant discount versus the subsector average of 31.69. The price-to-sales ratio is well below both the S&P 500 average and the subsector average, indicating a discount. Upon assessment of these and other key valuation criteria, LINCOLN EDUCATIONAL SERVICES proves to trade at a discount to investment alternatives.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| LINC 16.66 | Peers 105.57 | LINC 9.42 | Peers 26.57 | |||||||||||||||||||||
|
Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations. LINC is trading at a significant discount to its peers. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. LINC is trading at a significant discount to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
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| LINC 12.81 | Peers 159.45 | LINC 0.07 | Peers 2.01 | |||||||||||||||||||||
|
Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations. LINC is trading at a significant discount to its peers. |
Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. LINC trades at a significant discount to its peers. |
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| Price/Book |
|
Earnings Growth |
|
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| LINC 2.69 | Peers 31.69 | LINC 488.88 | Peers -391.50 | |||||||||||||||||||||
|
Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. LINC is trading at a significant discount to its peers. |
Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. LINC is expected to have an earnings growth rate that significantly exceeds its peers. |
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| Price/Sales |
|
Sales Growth |
|
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| LINC 0.54 | Peers 9.45 | LINC 6.29 | Peers 66.70 | |||||||||||||||||||||
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Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. LINC is trading at a significant discount to its subsector on this measurement. |
Lower. A sales growth rate that trails the subsector implies that a company is losing market share. LINC significantly trails its peers on the basis of sales growth. |
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