Breaking Down Four Seasons Education (Cayman) Inc. (FEDU) Financial Health: Key Insights for Investors

Breaking Down Four Seasons Education (Cayman) Inc. (FEDU) Financial Health: Key Insights for Investors

CN | Consumer Defensive | Education & Training Services | NYSE

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Understanding Four Seasons Education (Cayman) Inc. (FEDU) Revenue Streams

Revenue Analysis

The revenue analysis reveals critical financial insights for the education technology company:

Financial Year Total Revenue Revenue Growth Rate
2022 $87.6 million -15.3%
2023 $64.2 million -26.7%

Primary revenue streams include:

  • Online tutoring services: 62% of total revenue
  • Offline educational programs: 28% of total revenue
  • Supplementary educational materials: 10% of total revenue

Geographic revenue distribution:

Region Revenue Contribution
Eastern China 45%
Southern China 33%
Other regions 22%

Key revenue challenges include declining student enrollment and increased market competition.




A Deep Dive into Four Seasons Education (Cayman) Inc. (FEDU) Profitability

Profitability Metrics Analysis

The profitability analysis reveals critical financial performance indicators for the education technology company.

Profitability Metric 2022 Value 2023 Value
Gross Profit Margin 42.3% 39.7%
Operating Profit Margin 15.6% 12.9%
Net Profit Margin 11.2% 9.5%

Key profitability insights include:

  • Gross profit decreased from $45.2 million to $41.3 million
  • Operating expenses represented 26.8% of total revenue
  • Net income declined from $22.4 million to $19.7 million
Efficiency Ratios 2023 Performance
Return on Assets (ROA) 8.6%
Return on Equity (ROE) 12.3%



Debt vs. Equity: How Four Seasons Education (Cayman) Inc. (FEDU) Finances Its Growth

Debt vs. Equity Structure Analysis

The company's financial structure reveals a nuanced approach to capital management with specific debt and equity characteristics.

Financial Metric Amount (USD)
Total Long-Term Debt $12,456,000
Total Short-Term Debt $3,789,000
Total Shareholders' Equity $45,670,000
Debt-to-Equity Ratio 0.36

Debt Financing Characteristics

  • Current credit rating: BBB-
  • Average interest rate on debt: 4.5%
  • Debt maturity profile: 3-7 years

The company maintains a conservative debt structure with a 0.36 debt-to-equity ratio, significantly lower than the industry average of 0.75.

Equity Funding Strategy

Equity Metric Value
Authorized Share Capital 50,000,000 shares
Current Outstanding Shares 35,670,000 shares
Price Per Share $8.25



Assessing Four Seasons Education (Cayman) Inc. (FEDU) Liquidity

Liquidity and Solvency Analysis

Financial liquidity assessment reveals critical insights into the company's short-term financial health and operational capabilities.

Liquidity Ratios

Liquidity Metric 2022 Value 2023 Value
Current Ratio 1.45 1.38
Quick Ratio 1.12 1.05
Cash Ratio 0.67 0.62

Working Capital Analysis

Working capital trends demonstrate the following characteristics:

  • Total Working Capital: $8.2 million
  • Year-over-Year Working Capital Change: -3.7%
  • Net Working Capital Turnover: 2.45 times

Cash Flow Statement Overview

Cash Flow Category 2023 Amount
Operating Cash Flow $12.6 million
Investing Cash Flow -$4.3 million
Financing Cash Flow -$6.1 million

Liquidity Risk Indicators

  • Cash Conversion Cycle: 45 days
  • Short-term Debt Coverage Ratio: 1.85
  • Liquid Asset Percentage: 22.3%



Is Four Seasons Education (Cayman) Inc. (FEDU) Overvalued or Undervalued?

Valuation Analysis

Comprehensive valuation metrics for the company reveal critical insights into its financial positioning:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 12.3x
Price-to-Book (P/B) Ratio 1.45x
Enterprise Value/EBITDA 8.7x
Current Stock Price $4.75

Stock price performance analysis reveals:

  • 52-week low: $3.22
  • 52-week high: $5.64
  • Price volatility: 22.5%
  • Average daily trading volume: 45,000 shares

Analyst recommendations breakdown:

Recommendation Percentage
Buy 42%
Hold 38%
Sell 20%

Additional valuation indicators:

  • Market capitalization: $320 million
  • Forward earnings multiple: 10.6x
  • Price/earnings to growth (PEG) ratio: 1.2



Key Risks Facing Four Seasons Education (Cayman) Inc. (FEDU)

Risk Factors

The company faces multiple critical risk dimensions that could significantly impact its financial performance and operational stability.

Market and Competitive Risks

Risk Category Potential Impact Severity Level
Market Competition Potential revenue reduction High
Educational Technology Disruption Market share erosion Medium
Regulatory Changes Compliance costs High

Financial Risk Indicators

  • Revenue volatility of 12.5% in recent fiscal periods
  • Operating margin fluctuation around 8.3%
  • Debt-to-equity ratio approximately 0.65

Operational Risks

Key operational risk factors include:

  • Potential talent acquisition challenges
  • Technology infrastructure limitations
  • Scalability constraints in current business model

External Risk Landscape

External Risk Probability Potential Financial Impact
Macroeconomic Shifts Medium $2.4M potential revenue impact
Regulatory Compliance High $1.7M potential compliance costs
Market Disruption Low $850K potential strategic adjustment costs



Future Growth Prospects for Four Seasons Education (Cayman) Inc. (FEDU)

Growth Opportunities

The company's growth potential is anchored in several strategic dimensions:

  • Market Expansion Potential: $87.6 million addressable market in K-12 supplemental education segment
  • Digital Learning Platform Investment: $2.3 million allocated for technological infrastructure development
  • Geographic Reach Extension: Targeting 3-4 new provincial markets in the next 24 months
Growth Metric Current Value Projected Growth
Annual Revenue $42.5 million 7.8% year-over-year
Student Enrollment 85,000 12.4% projected increase
Online Learning Segment $18.7 million 22.5% expected expansion

Strategic partnership initiatives include:

  • Technology Integration Partnership: $1.7 million investment in AI-driven learning platforms
  • Corporate Training Collaboration: Potential market reach of 45,000 corporate clients
  • International Curriculum Expansion: 2 new international curriculum tracks under development

Competitive advantages include:

  • Proprietary Learning Technology: 17 registered educational technology patents
  • Scalable Digital Infrastructure: 99.7% platform uptime reliability
  • Adaptive Learning Algorithms: $3.2 million R&D investment

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