Perdoceo Education Corporation Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

As you might know, Perdoceo Education Corporation (NASDAQ:PRDO) just kicked off its latest quarterly results with some very strong numbers. It was overall a positive result, with revenues beating expectations by 3.0% to hit US$168m. Perdoceo Education reported statutory earnings per share (EPS) US$0.59, which was a notable 13% above what the analyst had forecast. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

Check out our latest analysis for Perdoceo Education

After the latest results, the consensus from Perdoceo Education's single analyst is for revenues of US$653.7m in 2024, which would reflect a measurable 4.2% decline in revenue compared to the last year of performance. Statutory earnings per share are expected to dip 8.9% to US$2.12 in the same period. Before this earnings report, the analyst had been forecasting revenues of US$650.9m and earnings per share (EPS) of US$2.04 in 2024. So the consensus seems to have become somewhat more optimistic on Perdoceo Education's earnings potential following these results.

The consensus price target rose 8.7% to US$25.00, suggesting that higher earnings estimates flow through to the stock's valuation as well.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 5.6% annualised decline to the end of 2024. That is a notable change from historical growth of 3.1% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 11% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Perdoceo Education is expected to lag the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Perdoceo Education's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analyst clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Perdoceo Education. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

We don't want to rain on the parade too much, but we did also find 3 warning signs for Perdoceo Education (1 is a bit concerning!) that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.