NYSE:NNI

Stock Analysis Report

Executive Summary

Nelnet, Inc. engages in loan servicing, communications, and education technology, services, and payment processing businesses worldwide.


Snowflake Analysis

Average dividend payer with mediocre balance sheet.


Similar Companies

Share Price & News

How has Nelnet's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NNI's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.4%

NNI

3.1%

US Consumer Finance

2.4%

US Market


1 Year Return

-21.7%

NNI

-37.7%

US Consumer Finance

-10.0%

US Market

Return vs Industry: NNI exceeded the US Consumer Finance industry which returned -46.9% over the past year.

Return vs Market: NNI underperformed the US Market which returned -15.9% over the past year.


Shareholder returns

NNIIndustryMarket
7 Day-2.4%3.1%2.4%
30 Day-11.4%-28.8%-11.0%
90 Day-26.2%-42.3%-19.4%
1 Year-20.8%-21.7%-36.6%-37.7%-8.1%-10.0%
3 Year3.4%-0.3%-15.8%-20.0%17.3%9.6%
5 Year3.3%-2.9%-17.8%-23.9%36.1%21.1%

Price Volatility Vs. Market

How volatile is Nelnet's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Nelnet undervalued compared to its fair value and its price relative to the market?

12.51x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: NNI ($44.31) is trading above our estimate of fair value ($42.01)

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


Price To Earnings Ratio

PE vs Industry: NNI is poor value based on its PE Ratio (12.5x) compared to the Consumer Finance industry average (3.7x).

PE vs Market: NNI is poor value based on its PE Ratio (12.5x) compared to the US market (12.2x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate NNI's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: NNI is overvalued based on its PB Ratio (0.7x) compared to the US Consumer Finance industry average (0.6x).


Next Steps

Future Growth

How is Nelnet forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

6.4%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if NNI's forecast earnings growth is above the savings rate (1.7%).

Earnings vs Market: Insufficient data to determine if NNI's earnings are forecast to grow faster than the US market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NNI's revenue (6.4% per year) is forecast to grow slower than the US market (7% per year).

High Growth Revenue: NNI's revenue (6.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NNI's Return on Equity is forecast to be low in 3 years time (7.5%).


Next Steps

Past Performance

How has Nelnet performed over the past 5 years?

-12.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NNI has high quality earnings.

Growing Profit Margin: NNI's current net profit margins (13.8%) are lower than last year (21.7%).


Past Earnings Growth Analysis

Earnings Trend: NNI's earnings have declined by -12.4% per year over the past 5 years.

Accelerating Growth: NNI's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: NNI had negative earnings growth (-37.8%) over the past year, making it difficult to compare to the Consumer Finance industry average (8.6%).


Return on Equity

High ROE: NNI's Return on Equity (5.9%) is considered low.


Next Steps

Financial Health

How is Nelnet's financial position?


Financial Position Analysis

Short Term Liabilities: NNI's short term assets ($22.8B) exceed its short term liabilities ($495.2M).

Long Term Liabilities: NNI's short term assets ($22.8B) exceed its long term liabilities ($20.8B).


Debt to Equity History and Analysis

Debt Level: NNI's debt to equity ratio (858.6%) is considered high.

Reducing Debt: NNI's debt to equity ratio has reduced from 1626% to 858.6% over the past 5 years.

Debt Coverage: NNI's debt is not well covered by operating cash flow (1.5%).

Interest Coverage: Insufficient data to determine if NNI's interest payments on its debt are well covered by EBIT.


Balance Sheet


Next Steps

Dividend

What is Nelnet's current dividend yield, its reliability and sustainability?

1.81%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: NNI's dividend (1.81%) isn’t notable compared to the bottom 25% of dividend payers in the US market (2.07%).

High Dividend: NNI's dividend (1.81%) is low compared to the top 25% of dividend payers in the US market (5.82%).


Stability and Growth of Payments

Stable Dividend: NNI's dividends per share have been stable in the past 10 years.

Growing Dividend: NNI's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (20.9%), NNI's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NNI's dividends in 3 years are forecast to be thoroughly covered by earnings (12% payout ratio).


Next Steps

Management

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

6.3yrs

Average management tenure


CEO

Jeff Noordhoek (53yo)

6.25s

Tenure

US$1,783,757

Compensation

Mr. Jeffrey R. Noordhoek, also known as Jeff, has been the Chief Executive Officer at Nelnet, Inc., since January 1, 2014. Mr. Noordhoek served as a Vice President of Nelnet Student Loan Corp- 2. He was re ...


CEO Compensation Analysis

Compensation vs Market: Jeff's total compensation ($USD1.78M) is below average for companies of similar size in the US market ($USD4.79M).

Compensation vs Earnings: Jeff's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Michael Dunlap
Executive Chairman of the Board24.25yrsUS$1.22m21.82% $384.2m
Jeffrey Noordhoek
Chief Executive Officer6.25yrsUS$1.78m1.31% $23.0m
Timothy Tewes
President6.25yrsUS$1.28m0.15% $2.6m
James Kruger
Chief Financial Officer6.25yrsUS$1.27m0.40% $7.1m
Terry Heimes
Chief Operating Officer6.25yrsUS$1.72m0.54% $9.5m
Phil Morgan
Investor Relations Contactno datano datano data
William Munn
Corporate Secretaryno dataUS$534.16k0.074% $1.3m

6.3yrs

Average Tenure

55yo

Average Age

Experienced Management: NNI's management team is seasoned and experienced (6.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Michael Dunlap
Executive Chairman of the Board24.25yrsUS$1.22m21.82% $384.2m
Kimberly Rath
Independent Director12.5yrsUS$180.21kno data
James Abel
Independent Director16.67yrsUS$170.94k0.027% $475.2k
Thomas Henning
Independent Lead Directorno dataUS$183.65k0.041% $722.2k
William Cintani
Independent Director7.92yrsUS$179.21k0.0099% $175.0k
Kathleen Farrell
Independent Director12.5yrsUS$184.74k0.021% $376.4k
David Graff
Independent Director5.92yrsUS$168.94k0.041% $718.3k
Preeta Bansal
Independent Director1.42yrsUS$82.61k0.010% $177.5k
JoAnn Martin
Independent Director0.083yrno datano data

10.2yrs

Average Tenure

58yo

Average Age

Experienced Board: NNI's board of directors are seasoned and experienced ( 10.2 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

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


Top Shareholders

Company Information

Nelnet, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Nelnet, Inc.
  • Ticker: NNI
  • Exchange: NYSE
  • Founded: 1978
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: US$1.761b
  • Shares outstanding: 39.73m
  • Website: https://www.nelnet.com

Number of Employees


Location

  • Nelnet, Inc.
  • 121 South 13th Street
  • Suite 100
  • Lincoln
  • Nebraska
  • 68508
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NNINYSE (New York Stock Exchange)YesClass A Common StockUSUSDDec 2003
NIJDB (Deutsche Boerse AG)YesClass A Common StockDEEURDec 2003

Biography

Nelnet, Inc. engages in loan servicing, communications, and education technology, services, and payment processing businesses worldwide. The company's Loan Servicing and Systems is involved in loan servicing activities, such as loan conversion, application processing, borrower updates, customer service, payment processing, due diligence procedures, funds management reconciliation, and claim processing activities for student loan portfolio and third-party clients. This segment also provides student loan servicing software; business process outsourcing services specialized in contact center management, such as inbound calls, outreach campaigns and sales, and interacting with customers through multi-channels. The Education Technology, Services, and Payment Processing segment offers financial management services; assistance with financial needs assessment; school information system software that automates administrative processes; professional development and educational instruction services; and technology products that aid in teacher and student evaluations. It also offers technology and payments services, including electronic transfer and credit card processing, reporting, billing and invoicing, mobile and virtual terminal solutions, and specialized integrations to business software; and mobile first technology focused on increasing engagement, online giving, and communication for church and not-for-profit customers. Its Communications segment fiber optic service to homes and businesses for internet, television, and telephone services. Its data services include high-speed internet access; telephone services comprise local and long distance telephone service, hostedPBX services, and other services. Its Asset Generation and Management segment acquires, manages, and owns loan assets. It also provides investment advisory services. The company was founded in 1978 and is headquartered in Lincoln, Nebraska. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/07 02:35
End of Day Share Price2020/04/06 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.