Earnings Preview: American Public - Analyst Blog
August 01 2011 - 8:15AM
Zacks
American Public Education
Inc. (APEI), an online provider of higher education to the
military and public service communities, is scheduled to report its
second-quarter 2011 financial results on August 2, 2011. The
current Zacks Consensus Estimate for the quarter is 45 cents a
share. For the quarter under review, revenue is $60 million,
according to the Zacks Consensus Estimate.
First-Quarter 2011, a
Synopsis
American Public’s quarterly
earnings of 43 cents a share missed the Zacks Consensus Estimate of
45 cents, but rose approximately 8% from 40 cents earned in the
prior-year quarter.
Total revenue of $58.7 million was
marginally ahead of the Zacks Consensus Estimate of $57 million,
and soared 24% from the prior-year quarter.
Total net course registration
surged 31% to approximately 81,100, and net course registrations
from new students grew 37% to approximately 17,800. American Public
stated that about 90,600 students were enrolled in the American
Public University System as of March 31, 2011, reflecting an
increase of 33%.
Guidance
American Public forecast a revenue
growth of approximately 28% and projects earnings between 43 cents
and 46 cents a share for second-quarter 2011.
Management expects second-quarter
2011 net course registrations to jump about 25%, and net course
registrations from new students to rise approximately 27%.
Second-Quarter 2011
Zacks Consensus
Analysts considered by Zacks,
expect American Public to post second-quarter 2011 earnings of 45
cents a share. The current Zacks Consensus Estimate reflects a
growth of 21.6% from the prior-year quarter earnings. The current
Zacks Consensus Estimate for the quarter ranges between 43 cents
and 46 cents a share.
Zacks Agreement &
Magnitude
Of the 13 analysts following the
stock, none of the analysts have revised their estimates in the
last 30 or 7 days, thereby keeping the Zacks Consensus Estimate
constant.
Mixed Earnings Surprise
History
With respect to earnings surprises,
American Public has topped as well as missed the Zacks Consensus
Estimate over the last four quarters in the range of negative 4.4%
to positive 12.1%. The average remained at positive 5.4%. This
suggests that American Public has beaten the Zacks Consensus
Estimate by an average of 5.4% in the trailing four quarters.
American Public in
Neutral Lane
American Public Education’s focus
on serving the military and public service personnel, high student
referral rates and accreditation enable it to consistently deliver
impressive top and bottom lines, as reaffirmed by its first-quarter
2011 results. The company’s sustained effort to expand educational
programs helps it to boost enrollments.
Surprisingly, the company has
predicted a 27% growth in new student enrollment for second-quarter
2011, despite the regulation proposed by the Department of
Education. The company now is primarily focusing on increasing net
registrations from civilian students, to safeguard itself from the
adverse impact of a fall in military registrations due to increased
military operations. Further, American Public’s debt-free balance
sheet and healthy cash reserves augur well for future operating
performance.
Currently, we have a long-term
‘Neutral’ rating on the stock. However, American Public, which
competes with Apollo Group Inc. (APOL), holds a
Zacks #2 Rank that translates into a short-term ‘Buy’ rating.
AMER PUB EDUCAT (APEI): Free Stock Analysis Report
APOLLO GROUP (APOL): Free Stock Analysis Report
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