Perdoceo Education (PRDO) Stock Forecast & Price Target

Perdoceo Education Corp demonstrated a solid enhancement in financial performance, highlighted by a 25.7% increase in revenue to $209.6 million in the second quarter, bolstered by contributions from the Colorado Technical University and the recent acquisition of the University of St. Augustine for Health Sciences. Total student enrollment at the American InterContinental University (AIUS) rose by 7.1%, reflecting a positive trend in organic enrollment growth and increased academic engagement. Additionally, the company experienced a significant increase in free cash flow, which grew 26.8% to $178.8 million, underscoring strong operational efficiency and profitability within its educational segments.

Perdoceo Education Corp has experienced a decline in segment operating income, which fell by 6.5% to $12.1 million, reflecting a decrease in margin from 24.1% to 22.1%, largely attributed to a one-time expense benefit in the prior year. Additionally, the American InterContinental University System reported a revenue drop of 1.2% to $56.7 million and a 2.9% decrease in total student enrollment, signaling challenges in attracting and retaining students. Overall, while management's guidance suggests a modest outlook for Q3/25 operating income, the persistent declines in operating metrics and enrollment raise concerns about the company's long-term financial stability.