Perdoceo Education (PRDO) Stock Forecast & Price Target

Perdoceo Education Corp has demonstrated a strong performance in student enrollment, with a 7.1% increase at the American InterContinental University segment, indicating effective growth strategies and underlying organic demand within its educational offerings. The company's total revenue for the second quarter rose significantly by 25.7% to $209.6 million, driven by consistent contributions from its primary segments and enhanced by the recent acquisition of the University of St. Augustine for Health Sciences, which added $36.7 million in revenue. Furthermore, the operating income for the segment increased 7.9% to $46.3 million, reflecting improved operational efficiencies and robust margins, as the overall margin rose to 39.2%.

Perdoceo Education Corp reported a decrease in segment operating income by 6.5%, down to $12.1 million, reflecting a decline in profitability margins from 24.1% to 22.1%, affected by non-recurring expenses from the previous year. Additionally, the company experienced a segment operating loss of $1.7 million, largely due to $7.2 million in depreciation and amortization expenses related to acquired assets and finance leases. Despite management’s optimistic Q3/25 guidance showing some expected growth in operating income, the underlying financial struggles cast a shadow on the company’s ability to maintain sustainable profitability going forward.