Why Adtalem (ATGE) Stock Is Nosediving

Vocational education company Adtalem Global Education reported Q4 CY2025 results topping the market’s revenue expectations, with sales up 12.4% year on year to $503.4 million. The company expects the full year’s revenue to be around $1.92 billion, close to analysts’ estimates. Its non-GAAP profit of $2.43 per share was 11.1% above analysts’ consensus estimates.

Adtalem (ATGE) Q4 CY2025 Highlights:

• Revenue: $503.4 million vs analyst estimates of $490.6 million (12.4% year-on-year growth, 2.6% beat)
• Adjusted EPS: $2.43 vs analyst estimates of $2.19 (11.1% beat)
• Adjusted EBITDA: $87.91 million vs analyst estimates of $138.3 million (17.5% margin, 36.5% miss)
• The company reconfirmed its revenue guidance for the full year of $1.92 billion at the midpoint
• Management raised its full-year Adjusted EPS guidance to $7.90 at the midpoint, a 1.9% increase
• Operating Margin: 22.1%, in line with the same quarter last year
• Market Capitalization: $4.05 billion

StockStory’s Take

Adtalem’s fourth quarter was marked by sustained enrollment gains and operational efficiency, prompting a favorable market response. Management attributed the positive results to strong performances at Walden University and Chamberlain, both of which reached record enrollment levels. CEO Stephen W. Beard emphasized, “This quarter marks our tenth consecutive quarter of enrollment growth.” The company also highlighted successful digital initiatives and targeted marketing improvements, particularly in its nursing and behavioral sciences programs, as critical factors supporting revenue and non-GAAP earnings growth.

Looking ahead, Adtalem’s updated guidance reflects confidence in continued enrollment momentum and disciplined capital allocation, including investments in new learning technologies. Management indicated that the company’s growth strategy will focus on expanding capacity and launching new academic programs, with Beard noting, “We will lay out our multiyear growth framework, including capacity expansion plans and new revenue streams, that position us to meet these societal needs while delivering sustainable earnings growth.” The company also anticipates that new partnerships, such as with Sallie Mae to address regulatory changes in student lending, will support future financial performance.

Key Insights from Management’s Remarks

Management attributed the quarter’s performance to enrollment growth, digital platform enhancements, and targeted improvements in student recruitment and marketing across its core academic segments.

• Walden enrollment momentum: Walden University saw its tenth consecutive quarter of enrollment growth, driven by behavioral sciences and nursing programs, with digital learning offerings attracting working professionals seeking flexibility.
• Chamberlain marketing revamp: Chamberlain implemented changes in marketing and enrollment funnel conversion, resulting in double-digit increases in application volumes for both pre-licensure and post-licensure nursing programs, although near-term enrollment remained flat.
• New academic programs launched: Walden introduced new master's degrees in applied behavioral analysis and clinical psychology, enrolling over 1,000 students in less than a year, and began streamlining its doctoral programs to improve student completion rates.
• Operational leverage and efficiency: Investments in technology and process improvements led to operational efficiencies, supporting margin stability despite ongoing investments in growth initiatives and capacity expansion.
• Capital allocation discipline: The company completed $165 million in share repurchases during the quarter and announced a new $750 million authorization, reflecting a continued focus on shareholder returns and strategic flexibility.

Drivers of Future Performance

Adtalem’s management expects future performance to be driven by enrollment trends, digital program expansion, and regulatory preparedness, while monitoring cost discipline and capital allocation.

• Capacity expansion and new programs: Management believes expanding student capacity and launching new academic offerings—especially in healthcare fields—will be key to driving enrollment and revenue growth in upcoming periods.
• Digital innovation investments: Continued investments in digital learning platforms and student-facing technologies are expected to improve student engagement and support the scalability of operations, contributing to margin expansion over time.
• Regulatory and lending landscape: The company is preparing for changes in student loan caps by advancing a partnership with Sallie Mae, anticipating that regulatory adaptation and access to supplemental lending will mitigate risks to student funding and overall enrollment.

Catalysts in Upcoming Quarters

Looking forward, our analysts are monitoring (1) the impact of new program launches and digital platform enhancements on student enrollment growth, (2) operational execution as Chamberlain aims for a return to positive enrollment trends in the fall cycle, and (3) the successful rollout of the Sallie Mae partnership in response to changes in student loan regulations. The company’s Investor Day may also provide greater clarity on long-term growth initiatives.

Adtalem currently trades at $119.54, up from $115.92 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).

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Vocational education company Adtalem Global Education reported Q4 CY2025 results topping the market’s revenue expectations, with sales up 12.4% year on year to $503.4 million. The company expects the full year’s revenue to be around $1.92 billion, close to analysts’ estimates. Its non-GAAP profit of $2.43 per share was 11.1% above analysts’ consensus estimates.

Adtalem (ATGE) Q4 CY2025 Highlights:

• Revenue: $503.4 million vs analyst estimates of $490.6 million (12.4% year-on-year growth, 2.6% beat)
• Adjusted EPS: $2.43 vs analyst estimates of $2.19 (11.1% beat)
• Adjusted EBITDA: $87.91 million vs analyst estimates of $138.3 million (17.5% margin, 36.5% miss)
• The company reconfirmed its revenue guidance for the full year of $1.92 billion at the midpoint
• Management raised its full-year Adjusted EPS guidance to $7.90 at the midpoint, a 1.9% increase
• Operating Margin: 22.1%, in line with the same quarter last year
• Free Cash Flow was $15.12 million, up from -$29.7 million in the same quarter last year
• Market Capitalization: $4.02 billion

“As America’s largest healthcare educator, we are uniquely positioned to address the growing healthcare workforce gaps at scale. Our second quarter results – our tenth consecutive quarter of enrollment growth, which was up 6.3% to 97,000 students – demonstrate our ability to meet this challenge head on,” said Steve Beard, chairman and chief executive officer, Adtalem Global Education.

Company Overview

Formerly known as DeVry Education Group, Adtalem Global Education is a global provider of workforce solutions and educational services.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last five years, Adtalem grew its sales at a 13.9% compounded annual growth rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the consumer discretionary sector, which enjoys a number of secular tailwinds.

We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new product or trend. Adtalem’s recent performance shows its demand has slowed as its annualized revenue growth of 12.4% over the last two years was below its five-year trend.

This quarter, Adtalem reported year-on-year revenue growth of 12.4%, and its $503.4 million of revenue exceeded Wall Street’s estimates by 2.6%.

Looking ahead, sell-side analysts expect revenue to grow 4.5% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and implies its products and services will see some demand headwinds.

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Operating Margin

Adtalem’s operating margin might fluctuated slightly over the last 12 months but has remained more or less the same, averaging 19.5% over the last two years. This profitability was lousy for a consumer discretionary business and caused by its suboptimal cost structure.

This quarter, Adtalem generated an operating margin profit margin of 22.1%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Adtalem’s EPS grew at a weak 21.4% compounded annual growth rate over the last five years. On the bright side, this performance was better than its 13.9% annualized revenue growth and tells us the company became more profitable on a per-share basis as it expanded.

In Q4, Adtalem reported adjusted EPS of $2.43, up from $1.81 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. We also like to analyze expected EPS growth based on Wall Street analysts’ consensus projections, but there is insufficient data.

Key Takeaways from Adtalem’s Q4 Results

It was good to see Adtalem beat analysts’ EPS expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. On the other hand, its EBITDA missed. Overall, this was a weaker quarter. The stock traded up 3.1% to $119.54 immediately following the results.

Should you buy the stock or not? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).

Vocational education company Adtalem Global Education will be reporting earnings this Wednesday after market hours. Here’s what to look for.

Adtalem beat analysts’ revenue expectations by 2% last quarter, reporting revenues of $462.3 million, up 10.8% year on year. It was a mixed quarter for the company, with a beat of analysts’ EPS estimates but full-year revenue guidance meeting analysts’ expectations.

Is Adtalem a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, analysts are expecting Adtalem’s revenue to grow 9.6% year on year to $490.6 million, slowing from the 13.9% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $2.19 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Adtalem has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 4.3% on average.

Looking at Adtalem’s peers in the consumer discretionary segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Nike posted flat year-on-year revenue, beating analysts’ expectations by 1.7%, and Carnival reported revenues up 6.6%, falling short of estimates by 0.6%. Nike traded down 10.5% following the results while Carnival was up 13.6%.

Read our full analysis of Nike’s results here and Carnival’s results here.

Investors in the consumer discretionary segment have had steady hands going into earnings, with share prices flat over the last month. Adtalem is up 13.1% during the same time and is heading into earnings with an average analyst price target of $158.25 (compared to the current share price of $118.75).

What Happened?

A number of stocks jumped in the afternoon session after investors wagered geopolitical tension would be contained following the U.S. military's operation in Venezuela, with the Dow hitting a fresh record. 

Sentiment remained firmly "risk-on" for early 2026, with Wall Street prioritizing domestic economic strength over foreign turbulence. Analysts noted that while the event raises short-term supply questions, the market largely viewed the potential stabilization of Venezuela's vast oil reserves as a long-term economic positive.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Leisure Products company YETI jumped 3.5%. Is now the time to buy YETI? Access our full analysis report here, it’s free for active Edge members.
• Leisure Facilities company Topgolf Callaway jumped 8.9%. Is now the time to buy Topgolf Callaway? Access our full analysis report here, it’s free for active Edge members.
• Toys and Electronics company Funko jumped 3.3%. Is now the time to buy Funko? Access our full analysis report here, it’s free for active Edge members.
• Real Estate Services company Cushman & Wakefield jumped 4.7%. Is now the time to buy Cushman & Wakefield? Access our full analysis report here, it’s free for active Edge members.
• Education Services company Adtalem jumped 6.8%. Is now the time to buy Adtalem? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Topgolf Callaway (MODG)

Topgolf Callaway’s shares are extremely volatile and have had 40 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 7 months ago when the stock gained 15.2% on the news that Director Adebayo Ogunlesi announced he bought 383,700 shares valued at about $2.5 million. These transactions are often seen as a sign of leadership's belief in the company's strategic plan and potential for future growth.

Topgolf Callaway is up 10.9% since the beginning of the year, and at $13 per share, has set a new 52-week high. Investors who bought $1,000 worth of Topgolf Callaway’s shares 5 years ago would now be looking at an investment worth $524.19.

Let’s dig into the relative performance of Laureate Education and its peers as we unravel the now-completed Q3 education services earnings season.

A whole industry has emerged to address the problem of rising education costs, offering consumers alternatives to traditional education paths such as four-year colleges. These alternative paths, which may include online courses or flexible schedules, make education more accessible to those with work or child-rearing obligations. However, some have run into issues around the value of the degrees and certifications they provide and whether customers are getting a good deal. Those who don’t prove their value could struggle to retain students, or even worse, invite the heavy hand of regulation.

The 7 education services stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.8% while next quarter’s revenue guidance was in line.

In light of this news, share prices of the companies have held steady as they are up 1.4% on average since the latest earnings results.

Laureate Education

Founded in 1998 by Douglas L. Becker and based in Miami, Laureate Education is a global network of higher education institutions.

Laureate Education reported revenues of $400.2 million, up 8.6% year on year. This print exceeded analysts’ expectations by 3.7%. Overall, it was a very strong quarter for the company with full-year revenue guidance exceeding analysts’ expectations and a solid beat of analysts’ revenue estimates.

Eilif Serck-Hanssen, President and Chief Executive Officer, said “We are pleased to report another strong quarter, driven by favorable operating performance as well as a weaker U.S. dollar. We were especially encouraged by our continued ability to scale our fully online offerings in Peru through our industry-leading digital portfolio and to deliver continued growth in Mexico despite a softer macroeconomic environment. The results from the intake cycles, combined with favorable foreign currency trends, give us the confidence to increase our full-year outlook for 2025.”

Interestingly, the stock is up 15.3% since reporting and currently trades at $33.31.

Best Q3: Lincoln Educational

Established in 1946, Lincoln Educational is a provider of specialized technical training in the United States, offering career-oriented programs to provide practical skills required in the workforce.

Lincoln Educational reported revenues of $141.4 million, up 23.6% year on year, outperforming analysts’ expectations by 7.5%. The business had a stunning quarter with a beat of analysts’ EPS and EBITDA estimates.

Lincoln Educational pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 31.1% since reporting. It currently trades at $23.34.

Weakest Q3: Grand Canyon Education

Founded in 1949, Grand Canyon Education is an educational services provider known for its operation at Grand Canyon University.

Grand Canyon Education reported revenues of $261.1 million, up 9.6% year on year, in line with analysts’ expectations. It was a slower quarter as it posted full-year EPS guidance missing analysts’ expectations and a significant miss of analysts’ EPS estimates.

Grand Canyon Education delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 7.2% since the results and currently trades at $165.39.

Read our full analysis of Grand Canyon Education’s results here.

Universal Technical Institute

Founded in 1965, Universal Technical Institute is a leading provider of technical training programs, specializing in automotive, diesel, collision repair, motorcycle, and marine technicians.

Universal Technical Institute reported revenues of $222.4 million, up 13.3% year on year. This number beat analysts’ expectations by 1.3%. It was a strong quarter as it also put up a beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.

Universal Technical Institute delivered the highest full-year guidance raise among its peers. The stock is down 15.8% since reporting and currently trades at $24.84.

Read our full, actionable report on Universal Technical Institute here, it’s free for active Edge members.

Adtalem

Formerly known as DeVry Education Group, Adtalem Global Education is a global provider of workforce solutions and educational services.

Adtalem reported revenues of $462.3 million, up 10.8% year on year. This print surpassed analysts’ expectations by 2%. More broadly, it was a mixed quarter as it also recorded a beat of analysts’ EPS estimates but full-year revenue guidance meeting analysts’ expectations.

Adtalem had the weakest full-year guidance update among its peers. The stock is down 26.4% since reporting and currently trades at $104.44.

Read our full, actionable report on Adtalem here, it’s free for active Edge members.