Afya (AFYA) AI Stock Analysis

• Market Cap: $1.34B
• Dividend Yield: <0.01%
• Average Volume (3M): 106.59K
• Price to Earnings (P/E): 10.5
• Beta (1Y): 0.75
• Revenue Growth: 3.48%
• EPS Growth: 12.63%
• Country: US
• Employees: 5,260
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Education & Training Services
• EPS (TTM): 0.39
• Shares Outstanding: 46,586,056
• 10 Day Avg. Volume: 88,315
• 30 Day Avg. Volume: 106,593
• PEG Ratio: 0.22
• Price to Book (P/B): 2.08
• Price to Sales (P/S): 2.68
• P/FCF Ratio: 6.85
• Enterprise Value/Market Cap: 1.35
• Enterprise Value/Revenue: 0.50
• Enterprise Value/Gross Profit: 0.76
• Enterprise Value/Ebitda: 1.12
• 1Y Price Target: $20.33
• Price Target Upside: 37.18% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: $17.00 ▲(14.71% Upside)

Afya's strong financial performance and positive earnings call are the most significant factors contributing to its score. The company's robust revenue growth, profitability, and strategic achievements in the earnings call highlight its potential for future success. Technical analysis indicates some bearish momentum, but valuation metrics suggest the stock is reasonably priced.

Positive Factors

Revenue Growth

Afya's strong revenue growth indicates robust demand for its educational services, enhancing its market position and supporting long-term financial stability.

Cash Flow Generation

Strong cash flow generation supports Afya's ability to invest in growth opportunities and manage debt, ensuring long-term operational flexibility.

Medical Education Expansion

Expanding medical education capacity strengthens Afya's leadership in the sector, potentially increasing future revenue and market share.

Negative Factors

User Retention Challenges

Declining user numbers in key segments could impact revenue growth and indicate challenges in maintaining customer engagement.

Revenue Growth Moderation

Moderating revenue growth suggests potential challenges in sustaining momentum, necessitating strategic initiatives to drive future expansion.

Debt Management

While leverage is currently manageable, ongoing debt monitoring is crucial to ensure financial stability and support long-term strategic goals.

Afya Business Overview & Revenue Model

Company Description

Afya Limited, through its subsidiaries, operates as a medical education group in Brazil. It offers educational products and services, including medical schools, medical residency preparatory courses, graduate courses, and other programs to lifelong medical learners enrolled across its distribution network, as well as to third-party medical schools. The company also provides digital health services, such as subscription-based mobile app and website portal that focuses on assisting health professionals and students with clinical decision-making through tools, such as medical calculators, charts, and updated content, as well as prescriptions, clinical scores, medical procedures and laboratory exams, and others. It offers health sciences courses, which comprise medicine, dentistry, nursing, radiology, psychology, pharmacy, physical education, physiotherapy, nutrition, and biomedicine; and degree programs and courses in other subjects and disciplines, including undergraduate and post graduate courses in business administration, accounting, law, civil engineering, industrial engineering, and pedagogy. In addition, the company provides medical postgraduate specialization programs; printed and digital content; and an online medical education platform and practical medical training services. As of December 31, 2021, it operated a network of 46 undergraduate and graduate medical school campuses consisted of 30 undergrad operating units and five approved units; and a network of 2,731 medical school seats that consisted of 2,481 operating seats and 278 approved seats. The company was founded in 1999 and is headquartered in Nova Lima, Brazil.

How the Company Makes Money

Afya generates revenue through multiple streams, primarily by providing educational services and products to healthcare professionals and institutions. The main revenue sources include tuition fees from medical programs, subscription fees for online courses, and sales of educational materials. Additionally, the company has partnerships with various universities and healthcare organizations, which help expand its reach and enhance its offerings. These collaborations often involve joint programs or certifications that further contribute to Afya's earnings. The growing demand for online education, particularly in the healthcare sector, bolsters Afya's financial performance, as more professionals seek flexible and accessible learning options.

Afya Financial Statement Overview

Summary

Afya exhibits a robust financial profile with strong revenue growth, profitability, and cash flow generation. The company effectively manages its leverage, ensuring a stable balance sheet. While growth rates have slightly moderated, Afya's financial health remains solid, positioning it well for future opportunities and challenges in the education and training services industry.

Income Statement

Afya demonstrates strong revenue growth with a consistent upward trajectory, evidenced by a 2.46% revenue growth in TTM. The company maintains robust profitability with a gross profit margin of 64.98% and a net profit margin of 20.08% in TTM. EBIT and EBITDA margins are healthy, indicating efficient operations. However, the slight decline in revenue growth rate compared to previous years suggests a need for strategic initiatives to sustain growth momentum.

Balance Sheet

Afya's balance sheet reflects a stable financial position with a manageable debt-to-equity ratio of 0.63 in TTM, showing improved leverage management. The return on equity of 16.20% in TTM indicates effective use of equity to generate profits. The equity ratio is solid, suggesting a strong capital structure. However, the company should continue monitoring its debt levels to maintain financial flexibility.

Cash Flow

Afya's cash flow performance is commendable, with a significant free cash flow growth rate of 11.23% in TTM, highlighting strong cash generation capabilities. The operating cash flow to net income ratio of 0.87 indicates efficient cash conversion. The free cash flow to net income ratio of 0.78 suggests a healthy cash flow relative to earnings, supporting future investments and debt servicing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.63B	3.30B	2.88B	2.33B	1.72B	1.20B
Gross Profit	2.36B	2.09B	1.77B	1.47B	1.07B	766.54M
EBITDA	1.61B	1.22B	1.11B	929.03M	603.33M	472.84M
Net Income	729.42M	631.51M	386.32M	373.57M	223.33M	292.07M
Balance Sheet
Total Assets	9.19B	8.83B	7.58B	7.20B	6.45B	4.79B
Cash, Cash Equivalents and Short-Term Investments	996.83M	911.01M	553.03M	1.09B	748.56M	1.05B
Total Debt	2.97B	3.17B	2.68B	2.71B	2.16B	1.14B
Total Liabilities	4.40B	4.52B	3.94B	3.95B	3.45B	1.96B
Stockholders Equity	4.75B	4.27B	3.60B	3.20B	2.95B	2.78B
Cash Flow
Free Cash Flow	1.26B	1.04B	798.20M	546.88M	354.07M	233.92M
Operating Cash Flow	1.56B	1.43B	1.04B	843.90M	630.87M	371.51M
Investing Cash Flow	-594.11M	-1.09B	-1.14B	-591.47M	-1.27B	-1.04B
Financing Cash Flow	-806.20M	23.97M	-439.94M	92.94M	364.68M	756.42M

Afya Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.82
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFYA, the sentiment is Positive. The current price of 14.82 is above the 20-day moving average (MA) of 14.45, below the 50-day MA of 15.01, and below the 200-day MA of 16.45, indicating a neutral trend. The MACD of -0.06 indicates Negative momentum. The RSI at 54.48 is Neutral, neither overbought nor oversold. The STOCH value of 58.87 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AFYA.

Afya Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AFYA	79 Outperform	$1.34B	10.46	15.51%	<0.01%	3.48%	12.63%
UTI	72 Outperform	$1.54B	25.44	23.11%	―	14.56%	127.02%
STRA	71 Outperform	$1.84B	16.19	6.76%	3.19%	3.74%	-8.40%
COUR	63 Neutral	$1.35B	―	-7.43%	―	8.10%	43.35%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
UDMY	60 Neutral	$720.17M	―	-1.78%	―	2.53%	95.79%
DAO	54 Neutral	$1.17B	36.49	―	―	-1.66%	―

Afya Corporate Events

Afya Limited Reports Strong Q3 2025 Financial Results and Strategic Initiatives

On November 12, 2025, Afya Limited announced its financial results for the third quarter and the first nine months of 2025, ending September 30. The company reported a 10.4% year-over-year increase in third-quarter revenue to R$928.5 million, with adjusted EBITDA rising 14.6% to R$398.9 million, reflecting a margin expansion to 43.0%. Net income for the quarter increased by 28.4% to R$159.4 million. For the nine-month period, revenue grew by 13.4% to R$2,784.3 million, and adjusted EBITDA increased by 18.5% to R$1,291.7 million. Afya also highlighted its strategic initiatives, including AI-enabled enhancements and the launch of Instituto Afya, aimed at long-term value creation. In October, the company issued R$1.5 billion in commercial notes to strengthen its capital structure, repurchasing shares and repaying debt, which underscores its disciplined capital management approach.

Afya Limited Reports Strong Financial Growth in Q3 2025

Afya Limited has released its unaudited interim condensed consolidated financial statements for the period ending September 30, 2025. The report highlights a significant increase in revenue and net income compared to the previous year, indicating strong operational performance. The company’s total assets have grown, and there is a notable increase in retained earnings, reflecting improved financial health. These results suggest a positive impact on Afya’s market positioning and potential benefits for stakeholders, showcasing the company’s resilience and growth in the educational sector.

Afya Expands Medical Education Capacity with New Seat Approvals

On November 7, 2025, Afya Limited announced that the Ministry of Education’s Secretary of Regulation and Supervision of Higher Education authorized an increase of 100 medical seats at ITPAC Porto Nacional in Bragança, Pará. This expansion brings the total to 150 seats on this campus and 3,753 approved seats overall, reinforcing Afya’s commitment to quality medical education and its position as a leading medical education provider in Brazil.

Afya Limited Announces Strategic Repurchase and Debt Repayment

On October 22, 2025, Afya Limited announced a significant financial maneuver involving the repurchase of 150,000 Series A Perpetual Convertible Preferred Shares from SBLA Holdco LLC, an affiliate of Softbank, for R$831.6 million. This transaction, set to close on November 3, 2025, will result in the cancellation of these shares. Additionally, Afya has fully repaid R$500 million in debentures issued by its subsidiary, Afya Participações S.A., ahead of their maturity dates in 2027 and 2028. These strategic financial actions are funded by proceeds from commercial notes issued by Afya Brazil on October 15, 2025, reflecting the company’s proactive approach to managing its financial obligations and capital structure.

Afya Limited Announces R$1.5 Billion Debenture Issuance

On October 9, 2025, Afya Limited announced that its subsidiary, Afya Participações S.A., approved the issuance of commercial notes totaling R$1,500 million in two series for private placement. The issuance aims to optimize Afya’s debt profile and fund general corporate purposes, including early redemption of debentures and repurchase of preferred shares, potentially enhancing its financial flexibility and operational efficiency.