Why Afya Stock Edged Higher Today
Brazil-based medical education company Afya (NASDAQ: AFYA) edged past many stocks in the market on Tuesday. The share price improved by 2.4%, which was sufficient to top the 1.9% increase of the bellwether S&P 500 index. Investors were encouraged by the company's recent performance as indicated by its third-quarter results.
Afya posted a mixed third quarter
Afya published those figures after market hours on Monday, and they showed that the company's adjusted net revenue rose by almost 25% year over year to 723 million reals ($147 million). Headline net income also saw a double-digit improvement, as it came in 22% higher at 98.2 million reals ($20 million). On a per-share basis, that shook out to 1.03 reals ($0.21).
That meant a mixed quarter for Afya, as analysts tracking the South American stock were estimating it would earn less than 718 million reals ($146 million). However, they were also modeling a higher per-share net income figure of 1.29 reals ($0.26).
Still, those growth numbers were encouraging, and provided plenty of optimism on a broadly lucrative day for stock investors. One positive development for Afya was that all three of its segments -- continuing education, digital health services, and undergraduate -- posted solid growth for the quarter. Of the trio, continuing education was the leader with 35% growth, while the largest (undergrad) rose by 25%.
Existing guidance reaffirmed
Afya also reaffirmed its previously published guidance. It's forecasting that it will post net revenue of 2.75 billion reals ($559 million) to 2.85 billion reals ($579 million). Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) should land at 1.1 billion reals ($224 million) to 1.2 billion reals ($244 million). The company did not provide any net income estimates.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
