NYSE:BFAM

Stock Analysis Report

Bright Horizons Family Solutions

Executive Summary

Bright Horizons Family Solutions Inc. provides child care and early education, back-up care, and educational advisory services for employers and families.


Snowflake Analysis

Moderate growth potential with acceptable track record.


Similar Companies

Share Price & News

How has Bright Horizons Family Solutions's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: BFAM has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-9.9%

BFAM

-7.0%

US Consumer Services

-11.2%

US Market


1 Year Return

26.1%

BFAM

17.3%

US Consumer Services

4.1%

US Market

Return vs Industry: BFAM exceeded the US Consumer Services industry which returned 17.3% over the past year.

Return vs Market: BFAM exceeded the US Market which returned 4.1% over the past year.


Shareholder returns

BFAMIndustryMarket
7 Day-9.9%-7.0%-11.2%
30 Day-4.2%1.6%-9.5%
90 Day4.4%11.2%-5.4%
1 Year26.1%26.1%17.6%17.3%6.2%4.1%
3 Year125.7%125.7%104.8%95.1%30.3%21.9%
5 Year213.4%213.4%173.0%140.6%55.0%38.0%

Price Volatility Vs. Market

How volatile is Bright Horizons Family Solutions's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Bright Horizons Family Solutions undervalued compared to its fair value and its price relative to the market?

50.39x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: BFAM ($157.15) is trading above our estimate of fair value ($139.92)

Significantly Below Fair Value: BFAM is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: BFAM is poor value based on its PE Ratio (50.4x) compared to the Consumer Services industry average (26x).

PE vs Market: BFAM is poor value based on its PE Ratio (50.4x) compared to the US market (16.7x).


Price to Earnings Growth Ratio

PEG Ratio: BFAM is poor value based on its PEG Ratio (3.9x)


Price to Book Ratio

PB vs Industry: BFAM is overvalued based on its PB Ratio (9.4x) compared to the US Consumer Services industry average (2.3x).


Next Steps

Future Growth

How is Bright Horizons Family Solutions forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

12.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BFAM's forecast earnings growth (12.8% per year) is above the savings rate (1.7%).

Earnings vs Market: BFAM's earnings (12.8% per year) are forecast to grow slower than the US market (12.9% per year).

High Growth Earnings: BFAM's earnings are forecast to grow, but not significantly.

Revenue vs Market: BFAM's revenue (8.3% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: BFAM's revenue (8.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: BFAM's Return on Equity is forecast to be high in 3 years time (23.9%)


Next Steps

Past Performance

How has Bright Horizons Family Solutions performed over the past 5 years?

18.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: BFAM has high quality earnings.

Growing Profit Margin: BFAM's current net profit margins (8.7%) are higher than last year (8.3%).


Past Earnings Growth Analysis

Earnings Trend: BFAM's earnings have grown by 18.5% per year over the past 5 years.

Accelerating Growth: BFAM's earnings growth over the past year (14.8%) is below its 5-year average (18.5% per year).

Earnings vs Industry: BFAM earnings growth over the past year (14.8%) underperformed the Consumer Services industry 25.4%.


Return on Equity

High ROE: BFAM's Return on Equity (18.6%) is considered low.


Next Steps

Financial Health

How is Bright Horizons Family Solutions's financial position?


Financial Position Analysis

Short Term Liabilities: BFAM's short term assets ($228.9M) do not cover its short term liabilities ($483.3M).

Long Term Liabilities: BFAM's short term assets ($228.9M) do not cover its long term liabilities ($1.9B).


Debt to Equity History and Analysis

Debt Level: BFAM's debt to equity ratio (107%) is considered high.

Reducing Debt: BFAM's debt to equity ratio has reduced from 122.6% to 107% over the past 5 years.

Debt Coverage: BFAM's debt is well covered by operating cash flow (31.8%).

Interest Coverage: BFAM's interest payments on its debt are well covered by EBIT (5.9x coverage).


Balance Sheet

Inventory Level: BFAM has a high level of physical assets or inventory.

Debt Coverage by Assets: BFAM's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is Bright Horizons Family Solutions's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate BFAM's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate BFAM's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if BFAM's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if BFAM's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of BFAM's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

7.1yrs

Average management tenure


CEO

Stephen Kramer (48yo)

2.1yrs

Tenure

US$3,390,321

Compensation

Mr. Stephen Howard Kramer has been the Chief Executive Officer and Director of Bright Horizons Family Solutions, Inc. since January 1, 2018 and has been its President since January 1, 2016. Mr. Kramer serv ...


CEO Compensation Analysis

Compensation vs Market: Stephen's total compensation ($USD3.39M) is below average for companies of similar size in the US market ($USD6.67M).

Compensation vs Earnings: Stephen's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Stephen Kramer
CEO, President & Director2.1yrsUS$3.39m0.17% $15.7m
Elizabeth Boland
Chief Financial Officer20.7yrsUS$1.19m0.21% $19.4m
Mary Burke-Afonso
Chief Operating Officer of North America Center Operations4.1yrsUS$1.05m0.050% $4.6m
Tammy Chuprevich
Senior Vice President of Operations19.4yrsno datano data
Michael Flanagan
Sr. Director of Investor Relations0yrsno datano data
John Casagrande
General Counsel & Secretary10.1yrsno data0.0029% $263.4k
Ilene Serpa
Vice President of Communications21.1yrsno datano data
Maribeth Bearfield
Chief Human Resources Officer0.08yrsno datano data
Danroy Henry
Chief Culture Officer3.7yrsUS$818.38kno data
Sandy Wells
Chief Development Officer0yrsno datano data

7.1yrs

Average Tenure

53yo

Average Age

Experienced Management: BFAM's management team is seasoned and experienced (7.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Stephen Kramer
CEO, President & Director2.1yrsUS$3.39m0.17% $15.7m
Joshua Bekenstein
Independent Director34.1yrsUS$157.50kno data
Mary Tocio
Independent Director18.3yrsUS$150.00k0.13% $12.3m
Roger Brown
Independent Director34.1yrsUS$152.50k0.0060% $546.0k
David Lissy
Non Executive Chairman2.1yrsUS$1.67m0.56% $51.7m
Linda Mason
Independent Director34.1yrsUS$150.00k0.042% $3.9m
Marguerite Kondracke
Independent Director15.2yrsUS$162.50k0.015% $1.3m
Sara Lawrence-Lightfoot
Independent Director27.1yrsUS$155.00k0.0017% $159.1k
Jordan Hitch
Independent Director12.1yrsUS$170.00kno data
Lawrence Alleva
Independent Director7.4yrsUS$182.50k0.0017% $159.1k

16.7yrs

Average Tenure

63yo

Average Age

Experienced Board: BFAM's board of directors are seasoned and experienced ( 16.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: BFAM insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Bright Horizons Family Solutions Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Bright Horizons Family Solutions Inc.
  • Ticker: BFAM
  • Exchange: NYSE
  • Founded: 1986
  • Industry: Education Services
  • Sector: Consumer Services
  • Market Cap: US$9.146b
  • Shares outstanding: 58.20m
  • Website: https://www.brighthorizons.com

Number of Employees


Location

  • Bright Horizons Family Solutions Inc.
  • 200 Talcott Avenue South
  • Watertown
  • Massachusetts
  • 2472
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BFAMNYSE (New York Stock Exchange)YesNew Common StockUSUSDJan 2013
BHADB (Deutsche Boerse AG)YesNew Common StockDEEURJan 2013

Biography

Bright Horizons Family Solutions Inc. provides child care and early education, back-up care, and educational advisory services for employers and families. The company operates through three segments: Full Service Center-Based Child Care, Back-Up Care, and Educational Advisory Services. The Full Service Center-Based Child Care segment offers traditional center-based child care, preschool, and elementary education services. The Back-Up Care segment provides center-based back-up child care, and in-home child and adult/elder dependent care services. The Educational Advisory Services segment offers tuition reimbursement program management and related educational consulting services, as well as college admissions advisory services. As of December 31, 2018, it operated 1,082 child care and early education centers in 41 U.S. states and the District of Columbia, Puerto Rico, the United Kingdom, Canada, the Netherlands, and India. The company was formerly known as Bright Horizons Solutions Corp. and changed its name to Bright Horizons Family Solutions Inc. in July 2012. Bright Horizons Family Solutions Inc. was founded in 1986 and is headquartered in Watertown, Massachusetts. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/29 01:09
End of Day Share Price2020/02/28 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.