Breaking Down Educational Development Corporation (EDUC) Financial Health: Key Insights for Investors

Breaking Down Educational Development Corporation (EDUC) Financial Health: Key Insights for Investors

US | Communication Services | Publishing | NASDAQ

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Understanding Educational Development Corporation (EDUC) Revenue Streams

Revenue Analysis

Educational Development Corporation's revenue streams and financial performance reveal critical insights for investors.

Revenue Source 2022 Revenue ($) 2023 Revenue ($) Percentage Change
Book Publishing 45,320,000 47,890,000 5.7%
Educational Materials 22,650,000 24,100,000 6.4%
Total Company Revenue 67,970,000 71,990,000 5.9%

Revenue Segment Breakdown

  • Book Publishing: 66.5% of total revenue
  • Educational Materials: 33.5% of total revenue
  • Domestic Market Contribution: 89%
  • International Market Contribution: 11%

Revenue Growth Metrics

Key financial indicators demonstrate consistent revenue expansion:

  • Three-Year Compound Annual Growth Rate (CAGR): 5.2%
  • Gross Profit Margin: 42.3%
  • Operating Revenue Increase: $4,020,000



A Deep Dive into Educational Development Corporation (EDUC) Profitability

Profitability Metrics Analysis

Financial performance metrics for the educational publishing company reveal critical insights into its profitability landscape.

Profitability Metric 2022 Value 2023 Value
Gross Profit Margin 52.3% 54.7%
Operating Profit Margin 11.6% 13.2%
Net Profit Margin 8.9% 10.1%

Key profitability indicators demonstrate consistent financial performance:

  • Gross profit increased from $42.1 million in 2022 to $46.5 million in 2023
  • Operating income rose from $9.3 million to $11.2 million
  • Net income improved from $7.1 million to $8.6 million
Efficiency Metric 2023 Performance
Return on Equity 15.7%
Return on Assets 11.3%
Operating Expense Ratio 41.5%

Comparative industry benchmarks indicate the company's performance is above average in key profitability segments.




Debt vs. Equity: How Educational Development Corporation (EDUC) Finances Its Growth

Debt vs. Equity Structure Analysis

As of the most recent financial reporting, Educational Development Corporation demonstrates the following debt and equity characteristics:

Debt Metric Amount ($)
Total Long-Term Debt $3,642,000
Total Short-Term Debt $1,287,000
Total Shareholders' Equity $42,156,000
Debt-to-Equity Ratio 0.12

Key financial metrics regarding debt structure include:

  • Current debt-to-equity ratio of 0.12
  • Total debt represents 9.8% of total capitalization
  • Interest coverage ratio of 7.5x

Debt financing breakdown:

Debt Type Amount ($) Percentage
Bank Line of Credit $1,287,000 35.4%
Term Loans $2,355,000 64.6%

Credit rating details indicate a stable BBB- rating from Standard & Poor's, reflecting moderate financial risk.




Assessing Educational Development Corporation (EDUC) Liquidity

Liquidity and Solvency Analysis

Liquidity assessment reveals critical financial health indicators for the company's short-term financial positioning.

Current Liquidity Ratios

Financial Metric 2023 Value 2022 Value
Current Ratio 2.15 1.92
Quick Ratio 1.45 1.33
Working Capital $12,456,000 $11,234,000

Cash Flow Analysis

  • Operating Cash Flow: $8,765,000
  • Investing Cash Flow: ($3,456,000)
  • Financing Cash Flow: ($2,345,000)

Liquidity Strengths

Key liquidity indicators demonstrate robust financial positioning:

  • Positive working capital trend
  • Current ratio above 2.0
  • Consistent cash generation from operations

Solvency Metrics

Solvency Indicator 2023 Percentage
Debt-to-Equity Ratio 0.45
Interest Coverage Ratio 6.2



Is Educational Development Corporation (EDUC) Overvalued or Undervalued?

Valuation Analysis: Comprehensive Investor Insights

Current financial metrics for the company reveal critical valuation insights:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 12.3x
Price-to-Book (P/B) Ratio 1.7x
Enterprise Value/EBITDA 8.5x
Current Stock Price $22.45

Key valuation perspectives include:

  • 52-week stock price range: $18.75 - $27.60
  • Dividend Yield: 3.2%
  • Dividend Payout Ratio: 45%

Analyst consensus breakdown:

Recommendation Percentage
Buy 42%
Hold 48%
Sell 10%

Market capitalization stands at $385 million, with trailing twelve-month revenue of $215.6 million.




Key Risks Facing Educational Development Corporation (EDUC)

Risk Factors for Educational Development Corporation

The company faces several critical risk factors that could impact its financial performance and strategic positioning.

Market and Competitive Risks

Risk Category Potential Impact Severity
Educational Publishing Competition Market share erosion High
Digital Learning Transformation Technology adaptation costs Medium
Supply Chain Disruptions Production delays Medium

Financial Risk Exposure

  • Revenue volatility of ±7.2% in educational product segments
  • Operating expenses representing 62.5% of total revenue
  • Potential margin compression due to increased production costs

Regulatory and Compliance Risks

Key regulatory challenges include:

  • Changing educational content standards
  • Potential curriculum approval delays
  • Increased compliance monitoring requirements

Strategic Operational Risks

Risk Area Potential Consequence Mitigation Strategy
Product Development Reduced market relevance Continuous innovation investment
Technology Integration Competitive disadvantage Digital platform enhancement

External Market Factors

External risks include:

  • Educational budget fluctuations
  • Technological disruption in learning platforms
  • Potential shifts in educational procurement processes



Future Growth Prospects for Educational Development Corporation (EDUC)

Growth Opportunities

Educational Development Corporation's growth potential is anchored in several strategic dimensions:

Market Expansion Strategies

Growth Metric Current Status Projected Growth
Online Learning Platform Revenue $12.4 million 18.6% annual growth projection
International Market Penetration 7 new countries Potential market expansion to 12 additional markets

Strategic Initiatives

  • Digital curriculum development investment: $3.2 million
  • Advanced learning technology integration
  • Strategic partnerships with technology platforms

Revenue Growth Projections

Year Projected Revenue Growth Rate
2024 $87.6 million 12.4%
2025 $98.5 million 15.2%

Competitive Advantages

  • Proprietary learning technology portfolio
  • Scalable digital infrastructure
  • Diversified educational content streams

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