SLM Corp Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component SLM Corp (NYSE:SLM) will unveil its latest earnings on Wednesday, October 19, 2011. SLM originates, services and collects student loans. It provides funding, delivery and servicing support for education loans in the United States.

SLM Corp Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 36 cents per share, a rise of 2.9% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 41 cents. Between one and three months ago, the average estimate moved down. It also has dropped from 38 cents during the last month. For the year, analysts are projecting net income of $1.82 per share, a decline of 5.2% from last year.

Past Earnings Performance: The company has beaten estimates the last four quarters and is coming off a quarter where it topped forecasts by 6 cents, reporting profit of 48 cents per share against a mean estimate of net income of 42 cents per share.

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Wall St. Revenue Expectations: On average, analysts predict $720.2 million in revenue this quarter, a decline of 17.4% from the year ago quarter. Analysts are forecasting total revenue of $3.11 billion for the year, a decline of 10.6% from last year’s revenue of $3.48 billion.

Analyst Ratings: three out of five analysts surveyed (60%) have a buy rating on SLM.. This is below the mean analyst rating of 10 competitors, which average 63.6% buy ratings.

A Look Back: In the second quarter, the company swung to a loss of $5.6 million (2 cents a share) from a profit of $337.8 million (63 cents) a year earlier, but beat analyst expectations. Revenue fell 43.4% to $1.05 billion from $1.85 billion.

Key Stats:

Revenue has fallen in the past four quarters. Revenue declined 14.2% in the first quarter from the year earlier, dropped 12.7% in fourth quarter of the last fiscal year from the year-ago quarter and 11.6% in the third quarter of the last fiscal year.

SLM’s loss in the latest quarter followed profits in the previous two quarters. The company reported a profit of $174.7 million in the first quarter and profit of $447.4 million in the fourth quarter of the last fiscal year.

Competitors to Watch: Nelnet, Inc. (NYSE:NNI), The Student Loan Corp. (NYSE:STU), Discover Financial Services (NYSE:DFS), American Express Company (NYSE:AXP), The First Marblehead Corp. (NYSE:FMD), Federal National Mortgage Association (FNMA), QC Holdings, Inc. (NASDAQ:QCCO), Advance America, Cash Advance Centers (NYSE:AEA), World Acceptance Corp. (NASDAQ:WRLD), and Federal Home Loan Mortgage Corp (FMCC).

Stock Price Performance: During July 20, 2011 to October 13, 2011, the stock price had fallen $2.68 (-16.6%) from $16.16 to $13.48. It saw one of its worst periods between September 15, 2011 and September 23, 2011 when shares fell for seven-straight days, falling 8.3% (-$1.12) over that span. The stock price saw one of its best stretches over the last year between October 19, 2010 and October 28, 2010 when shares rose for eight-straight days, rising 8.2% (+89 cents) over that span. Shares are up $1.06 (+8.5%) year to date.

(Source: Xignite Financials)

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