Lincoln Educational Services Earnings: Here’s Why Investors are Not Excited Now

Lincoln Educational Services Corporation (NASDAQ:LINC) had a loss and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 2.48%.

Lincoln Educational Services Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased to $-0.20 in the quarter versus EPS of $-0.14 in the year-earlier quarter.

Revenue: Decreased 15.11% to $85.2 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Lincoln Educational Services Corporation reported adjusted EPS loss of $0.20 per share. By that measure, the company beat the mean analyst estimate of $-0.31. It missed the average revenue estimate of $88.69 million.

Quoting Management: “We continue to make changes that will position Lincoln for long term success in this new operating environment,” said Shaun McAlmont, Lincoln’s Chief Executive Officer. “Our continued focus on regulatory compliance and student outcomes is producing positive incremental results in all key measures. Student retention continues to improve, showing a 90 basis point improvement over the same period last year. Our progress in improving graduate employment, 90/10 ratios and default rates makes us optimistic that these key outcomes will surpass defined accrediting and federal thresholds. Our new student starts from continuing operations, which exclude the announced campus closures, online and ATB, were essentially flat for the quarter with growth seen in our Automotive and Skilled Trades campuses. Although our overall growth fell short of our expectations, it shows continuing progress in our recovery.”

Key Stats (on next page)…

Revenue decreased 5.42% from $90.08 million in the previous quarter. EPS increased to $-0.20 in the quarter versus EPS of $-0.29 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.12 to a profit $0.08. For the current year, the average estimate has moved down from a loss of $0.10 to a loss of $0.20 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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