Shares of Lincoln Educational Services Corp (LINC, Financial) experienced a significant price movement today, rising by 10.78% to a current price of $17.825. This uptick follows the company's release of impressive fourth-quarter results, highlighted by revenue and adjusted EBITDA surpassing analysts' expectations, despite earnings per share trailing forecasts.
Lincoln Educational Services Corp, which trades under the ticker LINC, reported a 16.4% year-over-year increase in sales. This growth was fueled by a 13.7% boost in student enrollment and tuition hikes, as well as contributions from the newly launched East Point, Georgia campus. The company has also provided an optimistic full-year guidance, indicating that both revenue and EBITDA are expected to exceed consensus estimates, thanks in part to new campus openings and program expansions.
Despite today's positive movement, there are some cautionary notes regarding Lincoln Educational's financial metrics. The company's price-to-earnings (PE) ratio stands at 55.7, which is close to a three-year high and suggests a relatively high valuation. Additionally, Lincoln Educational's Price-to-Sales (PS) ratio is near a 10-year high, being at 1.24. However, its Altman Z-Score of 2.85 indicates it is in the grey area of financial stress. The company's Price-to-Book (PB) ratio is 3.3.
Lincoln Educational's GF Value assessment shows that the stock is significantly overvalued with a GF Value of 7.74, which is substantially lower than the current market price. Investors should be aware that insiders have been selling shares, with no recent insider buying recorded. Specifically, there have been 4 insider selling transactions over the past three months, amounting to 289,356 shares sold.
On the positive side, the company's Beneish M-Score of -2.45 suggests that it is unlikely to be a manipulator. As Lincoln Educational continues to expand its campus operations, investors may find potential growth opportunities. However, it's vital to weigh these prospects against its current valuations and financial stability.
