Shares of the ASX-listed IDP Education Ltd. (AU:IEL) gained nearly 4% on Tuesday after analyst Darren Leung from Macquarie upgraded the rating from Hold to Buy. Leung kept the price target unchanged at AU$16, predicting an upside of 25.6%. Leung believes the unpredictability due to changes in the student immigration policies in its key markets has already been factored into the stock’s valuation.In 2024, IEL stock fell over 40% amid the unstable global migration policies.
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IDP Education is a global education services company dedicated to helping individuals achieve their international education goals.
Macquarie Highlights Growth Potential in IDP Education
Macquarie highlighted further growth potential for IDP education. It expects that student placement and English language testing will return to sustainable growth starting in FY26. This came as a sigh of relief for investors after a difficult period for the company driven by recent reductions in student visa caps and upcoming elections in Australia and Canada.
Additionally, Macquarie noted that potential near-term downgrades and IDP’s upcoming first-half results could present attractive buying opportunities for investors.
IDP will announce its first-half result for FY25 on February 27.
IDP Education Delivers Strong FY24 Performance
Despite the challenging conditions, IDP reported a strong performance in FY24. The company’s revenue grew by 6% to $1.04 billion, primarily driven by a robust 27% growth in student placement revenue. Meanwhile, adjusted EBIT (earnings before interest and tax) reached $239 million, reflecting a 4% rise.
Additionally, the company highlighted record student placement volumes of 98,900, reflecting a 17% increase and significant growth in market share.
Is IEL a Buy?
According to TipRanks’ consensus, IEL stock has received a Moderate Buy rating based on two Buy and one Hold recommendation from analysts. The IDP share price forecast is AU$16.80, which is 32% above the current trading levels.
