The for-profit education company said profit in its fiscal first quarter fell to $98.9 million, or 87 cents a share, from $133.5 million, or $1.18 a share, a year earlier. When excluding special items, Apollo Education earned $1.04 a share; Wall Street expected 90 cents a share.
Revenue declined to $856.3 million in the quarter from $1.06 billion a year earlier.
TheStreet Ratings team rates APOLLO EDUCATION GROUP INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate APOLLO EDUCATION GROUP INC (APOL) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, expanding profit margins and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The gross profit margin for APOLLO EDUCATION GROUP INC is rather high; currently it is at 56.19%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 2.55% trails the industry average.
- APOL's share price has surged by 26.95% over the past year, reflecting the market's general trend, despite their weak earnings growth during the last quarter. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Diversified Consumer Services industry. The net income has significantly decreased by 71.4% when compared to the same quarter one year ago, falling from $75.45 million to $21.55 million.
- Net operating cash flow has decreased to $87.70 million or 35.29% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- You can view the full analysis from the report here: APOL Ratings Report