Universal Technical Institute, Inc. UTI reported impressive fourth-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. On a year-over-year basis, both top and bottom lines increased.
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The company completed the first phase of its North Star Strategy in fiscal 2024, achieving strong results and building momentum. The company met or exceeded guidance across all key metrics, supported by growth, diversification and optimization initiatives. Newly launched programs in both divisions contributed to growth, while workforce and facilities optimization improved margins.
With this progress, the company expects fiscal 2025 to deliver significant growth as it moves into the second phase of the strategy. Revenues and adjusted EBITDA are expected to grow at least 10% and 19%, respectively. The company is well-positioned to strengthen performance and create long-term value for its shareholders.
Inside the Numbers of UTI
Adjusted earnings per share (EPS) of 34 cents topped the consensus mark of 30 cents by 13.3% and rose significantly from the year-ago quarter’s level of 10 cents.
Quarterly revenues of $196.4 million topped the consensus mark of $191 million by 2.8% and increased 15.3% from the prior-year quarter’s figure. This upside was mainly attributable to growth in UTI and Concorde new student starts.
Universal Technical Institute Inc Price, Consensus and EPS Surprise
Universal Technical Institute Inc price-consensus-eps-surprise-chart | Universal Technical Institute Inc Quote
New student starts totaled 11,492, up 10.6% from 10,392 students reported a year ago.
Adjusted EBITDA was $37.3 million, up 94.6% from $19.2 million reported a year ago. Adjusted EBITDA margins of 19% grew 770 basis points (bps) from a year ago.
UTI’s Segment Highlights
UTI: Revenues from the segment rose 13.2% to $130.5 million year over year. New student starts totaled 7,068, up 8.7% from the prior year. Average undergraduate full-time active students increased 9.2%. This upside was backed by the growth in average full-time active students.
Adjusted EBITDA was $37.5 million, up from $21.5 million reported a year ago. Adjusted EBITDA margins of 28.7% grew 980 bps from a year ago.
Concorde: Revenues from the segment were $65.8 million during the reported period, up 19.7% from a year ago. New student starts totaled 4,424, up 13.7% from a year ago.
Adjusted EBITDA in the segment totaled $8.3 million, up from $4 million reported a year ago. Adjusted EBITDA margins of 12.6% increased 530 bps from a year ago.
UTI’s Fiscal 2024 Highlights
Universal Technical reported revenues of $732.7 million, which increased 20.6% year over year, backed by a rise in average undergraduate full-time active students at both UTI and Concorde, along with the inclusion of two additional months of revenues for Concorde.
Earnings were 75 cents per share, up from 13 cents generated in fiscal 2023.
New student starts increased to 26,885 from the prior-year level of 22,613.
Adjusted EBITDA in the fiscal year was $102.9 million compared with $60.1 million a year ago.
Financial Details of UTI
At the end of fiscal 2024, the company had cash and cash equivalents of $161.9 million compared with $151.5 million at the fiscal 2023-end.
Long-term debt is now $123 million, down from $159.6 million at the end of the fiscal 2023.
Net cash used in operations was $85.9 million in fiscal 2024 compared with $49.1 million recorded a year ago.
Adjusted free cash flow for fiscal 2024 was $73.5 million compared with $49.1 million in the prior year and exceeded the full-year guidance range of $62-66 million.
UTI’s Fiscal 2025 Guidance Raised
Universal Technical expects new student starts in the 28,000-29,000 range. Revenues are anticipated to be in the range of $800-$815 million.
Net income is estimated in the range of $52-$56 million. The company expects adjusted EBITDA in the range of $120-$124 million.
Universal Technical anticipates adjusted EPS in the range of 93 cents to $1.01. Adjusted free cash flow is expected to be between $58 million and $62 million.
UTI’s Zacks Rank & Peer Releases
Universal Technical currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Lincoln Educational Services Corporation LINC reported mixed results for third-quarter 2024. Its earnings missed the Zacks Consensus Estimate, but revenues topped the same.
Nonetheless, both metrics increased year over year, driven by a 10.6% increase in the average student population. This uptick resulted from four consecutive quarters of double-digit start growth and the recently opened East Point, GA campus, which generated $3.4 million in revenues in the third quarter.
Strategic Education, Inc. STRA, or SEI, reported impressive results for third-quarter 2024. Its quarterly earnings and revenues topped the Zacks Consensus Estimate and increased year over year.
The company witnessed strong employer-affiliated enrollment in the U.S. Higher Education segment, strong growth from Sophia subscriptions in the Education Technology Services segment and another quarter of total enrollment growth in the Australia/New Zealand segment.
Adtalem Global Education Inc. ATGE posted better-than-expected results in first-quarter fiscal 2025. Earnings and revenues surpassed the Zacks Consensus Estimate and increased year over year, given strong enrollment growth and strategic initiatives.
ATGE raised its fiscal 2025 guidance, expecting revenues between $1.69 billion and $1.73 billion, which indicates confidence in sustained growth momentum.
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