Education Stock Gaining Traction This Year- ASX: IEL

  • Apr 12, 2019 AEST
  • Team Kalkine
Education Stock Gaining Traction This Year- ASX: IEL

Researchers are of the view that educators online are quickly adopting new technologies like cloud-based services, artificial intelligence and so forth, should be well placed. Also, the researchers believe that Asian region provides ideal opportunity for companies catering to the education sector. With opportunity for high technology educators addressing the higher education and vocational studies.

Holon IQ platform is the most comprehensive data-set around the globe, on the front of international education sector. According to its estimation, by 2030 the education market worldwide would reach USD10 trillion.

One such stock is IDP Education Limited (ASX: IEL), which is gaining traction this year. The company caters to the requirements related to course applications and visa on a day-to-day basis. IEL has precise information on the number of copies a person would require, or the number of passport photos to be taken. The company has contacts at individual institutions it works with, in case a person requires extra information on them.

In its H1 FY19, half-year financial results for the period ending on 31 December 2018, the group noted a solid rise in its earnings for H1 FY19. The net profit after tax (NPAT) rose to around 34 percent to $40.7 million from $30.5 million in H1 FY18.

The outcome was majorly determined by a 26 percent rise in revenue with company’s individual product lines giving solid volume growth. The revenue of English Language Testing increased by 20 percent, including the IELTS testing volumes rise by 18 percent, in the half-year period. The Student Placement revenue observed 40 percent growth, reinforced by solid growth in volumes to the UK and Canada, rises in average price.  The Digital Marketing and Events revenue rose by 27 percent with Hotcourses, being the main driver of this progress.

From a segmental perspective, the outcome was reinforced by continuous growth in Asia and the rest of the World. Solid performances were noted in Asian region, as well as in Indonesian, Bangladesh and Vietnamese region. China recorded strong growth in both Australian and multi-destination student placement revenue. The positive outcome in the rest of the world segment demonstrated good growth in IELTS volumes in Canada, Nigeria, Uzbekistan and the Middle East region. The UAE also recorded double-digit volume growth in student placement, which was a highlight for the Middle East student placement operations.

The profit for the half-year period, ending on 31 December 2018 was recorded at $40 million, by the group. The total assets of the company stood at $361 million from $288 million in the previous corresponding period (pcp). The total liabilities on 31 December 2018 stood at $204 million from $187 million in the pcp. The total equity was noted at $156 million from $101 million in the pcp.

From the cash flow perspective, the group recorded the net cash inflow from operating activities on 31 December 2018 of $25.7 million from $16.5 million in the pcp.  The cash and cash equivalents at the end of the half-year period stood at around $54.7 million from $34 million in the pcp.

Let’s have a quick glance at the company’s stock performance over the period of the last twelve months. The stock has performed consistently well in the past few months, generating a massive yield of 104.09% in the last 12 months. The stock’s yield in the last six months period was noted at 55.67%, and 0.81% yield was generated in the last month.  The company has a market capitalisation of around A$3.81 billion, with circa 254.44 million shares outstanding.

The stock of the company last traded at A$15.450 (as on 12 April 2019), up by 3.275% from its previous close.


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