Educational Development (NASDAQ:EDUC) Posts Quarterly Earnings Results, Misses Expectations By $0.65 EPS

Educational Development (NASDAQ:EDUC) posted its quarterly earnings results on Tuesday. The company reported ($0.37) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.28 by ($0.65), FiscalAI reports. The firm had revenue of $4.18 million for the quarter, compared to analyst estimates of $40.00 million. Educational Development had a negative return on equity of 17.83% and a net margin of 10.15%.

Here are the key takeaways from Educational Development’s conference call:

• Revenue and active brand partners declined sharply in the fourth quarter, with net revenues falling to $4.2 million from $6.6 million and average active PaperPie brand partners dropping to 4,500 from 9,400 year over year.
• The company reported a net loss of $3.1 million in Q4, including a $1.0 million tax expense driven by a one-time $1.5 million valuation allowance adjustment.
• Management is in the middle of a turnaround plan centered on inventory replenishment, including new titles and best-selling out-of-stock items that are now starting to arrive and are expected to support future sales.
• The March join special added almost 1,400 new brand partners, which management said shows renewed interest in the business and could help improve recruiting and sales momentum in fiscal 2027.
• EDC ended the year with $7 million of cash flow from inventory reductions, reduced inventory to $37.7 million, and secured a new $2 million line of credit with no covenants to support growth.

Educational Development Price Performance

Shares of NASDAQ:EDUC opened at $1.44 on Thursday. The company has a market cap of $12.25 million, a price-to-earnings ratio of 5.54 and a beta of 1.02. The firm has a 50 day simple moving average of $1.37 and a 200 day simple moving average of $1.36. Educational Development has a one year low of $1.01 and a one year high of $1.84.

Hedge Funds Weigh In On Educational Development

Several institutional investors and hedge funds have recently added to or reduced their stakes in EDUC. Bridgeway Capital Management LLC bought a new position in Educational Development in the 4th quarter valued at approximately $29,000. Citadel Advisors LLC bought a new position in Educational Development in the 3rd quarter valued at approximately $36,000. Finally, State Street Corp lifted its stake in Educational Development by 106.0% in the 4th quarter. State Street Corp now owns 31,876 shares of the company’s stock valued at $42,000 after purchasing an additional 16,400 shares during the last quarter. Institutional investors own 19.60% of the company’s stock.

Analyst Ratings Changes

Separately, Weiss Ratings raised shares of Educational Development from a “hold (c-)” rating to a “hold (c)” rating in a research note on Monday, May 11th. One equities research analyst has rated the stock with a Hold rating, According to data from MarketBeat.com, the company currently has an average rating of “Hold”.

Educational Development Company Profile

Educational Development Corporation, through its subsidiaries, engages in the direct marketing and digital retailing of educational and inspirational reading materials, including books, Bibles, devotionals, and related gift items. The company’s product portfolio extends to children’s literature, music, and home décor, targeting consumers in the faith-based and human-interest segments. Products are sold under proprietary brands across multiple online and catalog platforms.

Central to the company’s operations are its e-commerce websites and print catalogs, which support both retail and wholesale distribution channels.