Latest news with #SCHL
Globe and Mail
14-04-2025
- Business
- Globe and Mail
3 Reasons SCHL is Risky and 1 Stock to Buy Instead
What a brutal six months it's been for Scholastic. The stock has dropped 40.1% and now trades at a new 52-week low of $16.01, rattling many shareholders. This may have investors wondering how to approach the situation. Is now the time to buy Scholastic, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it's free. Even though the stock has become cheaper, we're cautious about Scholastic. Here are three reasons why SCHL doesn't excite us and a stock we'd rather own. Why Is Scholastic Not Exciting? Creator of the legendary Scholastic Book Fair, Scholastic (NASDAQ:SCHL) is an international company specializing in children's publishing, education, and media services. 1. Long-Term Revenue Growth Flatter Than a Pancake Reviewing a company's long-term sales performance reveals insights into its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Unfortunately, Scholastic struggled to consistently increase demand as its $1.59 billion of sales for the trailing 12 months was close to its revenue five years ago. This was below our standards and signals it's a lower quality business. 2. Weak Operating Margin Could Cause Trouble Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It's also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes. Scholastic's operating margin has shrunk over the last 12 months and averaged 3% over the last two years. The company's profitability was mediocre for a consumer discretionary business and shows it couldn't pass its higher operating expenses onto its customers. 3. Previous Growth Initiatives Haven't Impressed Growth gives us insight into a company's long-term potential, but how capital-efficient was that growth? Enter ROIC, a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity). Scholastic historically did a mediocre job investing in profitable growth initiatives. Its five-year average ROIC was 4.6%, lower than the typical cost of capital (how much it costs to raise money) for consumer discretionary companies. Final Judgment Scholastic's business quality ultimately falls short of our standards. After the recent drawdown, the stock trades at 9.5× forward price-to-earnings (or $16.01 per share). While this valuation is optically cheap, the potential downside is big given its shaky fundamentals. We're pretty confident there are more exciting stocks to buy at the moment. We'd suggest looking at the most entrenched endpoint security platform on the market. Stocks We Like More Than Scholastic The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free.
Yahoo
29-03-2025
- Business
- Yahoo
1 Value Stock to Target This Week and 2 to Avoid
Value investing has created more billionaires than any other strategy, like Warren Buffett, who built his fortune by purchasing wonderful businesses at reasonable prices. But these hidden gems are few and far between - many stocks that appear cheap often stay that way because they face structural issues. This distinction between true value and value traps can challenge even the most skilled investors. Luckily for you, we started StockStory to help you uncover exceptional companies. That said, here is one value stock trading at a big discount to its intrinsic value and two with little support. Forward P/E Ratio: 10.8x Creator of the legendary Scholastic Book Fair, Scholastic (NASDAQ:SCHL) is an international company specializing in children's publishing, education, and media services. Why Are We Cautious About SCHL? Sales were flat over the last five years, indicating it's failed to expand its business Responsiveness to unforeseen market trends is restricted due to its substandard operating profitability Underwhelming 4.6% return on capital reflects management's difficulties in finding profitable growth opportunities Scholastic's stock price of $19.03 implies a valuation ratio of 10.8x forward price-to-earnings. Check out our free in-depth research report to learn more about why SCHL doesn't pass our bar. Forward P/E Ratio: 5.5x With 19 different brands across the globe, Columbus McKinnon (NASDAQ:CMCO) offers material handling equipment for the construction, manufacturing, and transportation industries. Why Do We Think CMCO Will Underperform? Annual revenue growth of 2.4% over the last two years was below our standards for the industrials sector Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 1.8% annually Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 12.8 percentage points Columbus McKinnon is trading at $17.93 per share, or 5.5x forward price-to-earnings. Dive into our free research report to see why there are better opportunities than CMCO. Forward P/E Ratio: 12.4x Founded in 1980 as a provider for underserved communities in Southern California, Molina Healthcare (NYSE:MOH) provides managed healthcare services primarily to low-income individuals through Medicaid, Medicare, and Marketplace insurance programs across 21 states. Why Does MOH Stand Out? Impressive 19.3% annual revenue growth over the last five years indicates it's winning market share this cycle Economies of scale give it fixed cost leverage when sales grow as well as negotiating power over membership pricing and reimbursement rates Earnings per share grew by 12.2% annually over the last five years, comfortably beating the peer group average At $323.48 per share, Molina Healthcare trades at 12.4x forward price-to-earnings. Is now the time to initiate a position? Find out in our full research report, it's free. The elections are now behind us. With rates dropping and inflation cooling, many analysts expect a breakout market - and we're zeroing in on the stocks that could benefit immensely. Take advantage of the rebound by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like United Rentals (+322% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
Washington Post
20-03-2025
- Business
- Washington Post
Scholastic: Fiscal Q3 Earnings Snapshot
NEW YORK — NEW YORK — Scholastic Corp. (SCHL) on Thursday reported a loss of $3.6 million in its fiscal third quarter. On a per-share basis, the New York-based company said it had a loss of 13 cents. Losses, adjusted for non-recurring costs, were 5 cents per share. The publishing, education and media company posted revenue of $335.4 million in the period.
