Capella Education Company (CPLA: 80.10 +3.14 +4.08%), the provider of online education, recently reported stronger-than-expected fourth-quarter 2009 results buoyed by a rise in enrollment.
The quarterly earnings of 88 cents a share, outstripped the Zacks Consensus Estimate of 85 cents, and grew 33.3% from 66 cents delivered in the prior-year quarter.
The quarterly earnings topped the Zacks Consensus Estimate by 3.5%. In terms of earnings surprises, Capella outperformed the Zacks Consensus Estimate in third-quarter 2009 by 13.7% and by 12% in the second quarter. The current Zacks Consensus Estimate for first-quarter 2010 is 63 cents. Over the last 30 days, the Zacks Consensus Estimate has remained stagnant with none of the 18 analysts covering the stock revising their estimates.
Higher education sees a countercyclical movement in an economic recession. Post-secondary enrollments tend to rise as both unemployed and employed workers return to school to re-skill themselves and existing students remain in school for a longer duration compelled by the intensely competitive job market.
Total active enrollment rose 26.4% year-over-year to 33,982 in fiscal year 2009. Average quarterly enrollment jumped 24.3%. Management expects average quarterly enrollment to climb between 25% and 27% in fiscal year 2010, and between 30% and 32% in first-quarter 2010 helped by the launch of new education programs.
Due to the surge in enrollment, revenue for the quarter grew 24.8% to $94.5 million. Capella expects revenue to rise in the range of 28% to 30% in first-quarter 2010, and between 24.5% and 26.5% in fiscal year 2010.
Despite a rise of 20.6% in total costs and expenses, operating income for the quarter soared 39.9% to $22.9 million helped by double-digit growth in the top-line, whereas operating margin expanded 270 basis points to 24.3%. Capella expects first-quarter 2010 operating margin in the range of 20% to 21%.
For fiscal year 2010, management expects operating income to rise between 35% and 45%, and operating margins being 21% to 22%.
Capella ended fiscal year 2009 with cash and cash equivalents of $102.4 million, shareholders’ equity of $184.3 million and no debt. Cash flow from operations for the year surged 54% to $69.1 million.
The quarterly earnings of 88 cents a share, outstripped the Zacks Consensus Estimate of 85 cents, and grew 33.3% from 66 cents delivered in the prior-year quarter.
The quarterly earnings topped the Zacks Consensus Estimate by 3.5%. In terms of earnings surprises, Capella outperformed the Zacks Consensus Estimate in third-quarter 2009 by 13.7% and by 12% in the second quarter. The current Zacks Consensus Estimate for first-quarter 2010 is 63 cents. Over the last 30 days, the Zacks Consensus Estimate has remained stagnant with none of the 18 analysts covering the stock revising their estimates.
Higher education sees a countercyclical movement in an economic recession. Post-secondary enrollments tend to rise as both unemployed and employed workers return to school to re-skill themselves and existing students remain in school for a longer duration compelled by the intensely competitive job market.
Total active enrollment rose 26.4% year-over-year to 33,982 in fiscal year 2009. Average quarterly enrollment jumped 24.3%. Management expects average quarterly enrollment to climb between 25% and 27% in fiscal year 2010, and between 30% and 32% in first-quarter 2010 helped by the launch of new education programs.
Due to the surge in enrollment, revenue for the quarter grew 24.8% to $94.5 million. Capella expects revenue to rise in the range of 28% to 30% in first-quarter 2010, and between 24.5% and 26.5% in fiscal year 2010.
Despite a rise of 20.6% in total costs and expenses, operating income for the quarter soared 39.9% to $22.9 million helped by double-digit growth in the top-line, whereas operating margin expanded 270 basis points to 24.3%. Capella expects first-quarter 2010 operating margin in the range of 20% to 21%.
For fiscal year 2010, management expects operating income to rise between 35% and 45%, and operating margins being 21% to 22%.
Capella ended fiscal year 2009 with cash and cash equivalents of $102.4 million, shareholders’ equity of $184.3 million and no debt. Cash flow from operations for the year surged 54% to $69.1 million.
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