Bright Horizons (BFAM) AI Stock Analysis

• Market Cap: $6.90B
• Dividend Yield: N/A
• Average Volume (3M): 507.22K
• Price to Earnings (P/E): 43.6
• Beta (1Y): 0.70
• Revenue Growth: 9.71%
• EPS Growth: 94.22%
• Country: US
• Employees: 32,050
• Sector: Consumer Cyclical
• Sector Strength: 61
• Industry: Personal Products & Services
• EPS (TTM): 0.77
• Shares Outstanding: 57,253,440
• 10 Day Avg. Volume: 610,064
• 30 Day Avg. Volume: 507,221
• PEG Ratio: 2.54
• Price to Book (P/B): 3.41
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 28.66
• Enterprise Value/Market Cap: 0.81
• Enterprise Value/Revenue: 0.53
• Enterprise Value/Gross Profit: 8.76
• Enterprise Value/Ebitda: 4.12
• 1Y Price Target: $136.75
• Price Target Upside: 13.41% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 73 Outperform
• Price Target: $137.00 ▲(13.62%Upside)

Bright Horizons Family Solutions shows a robust financial performance and positive corporate developments, which are the primary drivers of its stock score. However, overvaluation and mixed technical signals moderate the overall score. The earnings call's optimistic guidance and strategic progress further support the stock's potential.

Positive Factors

Back-up care business growth

Growth in the back-up care business impresses as employers increasingly provide incremental services, despite overall margin pressures.

Debt reduction and stock repurchase

BFAM paid down $49.5M in debt and repurchased ~$20M in stock.

Positive earnings results

1Q25 results beat consensus expectations driven by margins, especially at BUCA.

Negative Factors

Enrollment challenges

Enrollment is plateauing due to structural changes like hybrid work and universal pre-k, along with pricing fatigue from parents.

Operating margin pressures

Operating margins are expected to remain pressured below pre-COVID levels in the medium term.

Recovery challenges

The ability to reach pre-COVID occupancy levels is seen as challenging due to affordability concerns, hybrid workforces, and increased government programs.

Bright Horizons Business Overview & Revenue Model

Company Description

Bright Horizons Family Solutions Inc. provides early education and child care, back-up care, educational advisory, and other workplace solutions services for employers and families. The company operates through three segments: Full Service Center-Based Child Care, Back-Up Care, and Educational Advisory and Other Services. The Full Service Center-Based Child Care segment offers traditional center-based child care and early education, preschool, and elementary education services. The Back-Up Care segment provides center-based back-up child care, in-home child and adult/elder dependent care, school-age camps, virtual tutoring, and self-sourced reimbursed care services through child care centers, school-age campuses, and in-home caregivers, as well as the back-up care network. The Educational Advisory and Other Services segment offers tuition assistance and student loan repayment program administration, workforce education, and related educational consulting services, as well as college admissions advisory services. As of December 31, 2021, it operated 1,014 child care and early education centers in the United States, Puerto Rico, the United Kingdom, Canada, the Netherlands, and India. The company was formerly known as Bright Horizons Solutions Corp. and changed its name to Bright Horizons Family Solutions Inc. in July 2012. Bright Horizons Family Solutions Inc. was founded in 1986 and is headquartered in Newton, Massachusetts.

How the Company Makes Money

Bright Horizons generates revenue primarily through its employer-sponsored childcare centers, which are funded by corporate clients who offer these services as employee benefits. Additionally, the company earns income from back-up care services, which provide temporary care solutions to families in need of short-term childcare. Another significant revenue stream is the educational advisory services, which include college admissions counseling and related support. Bright Horizons partners with businesses to develop customized solutions, ensuring a steady flow of clients and maintaining long-term contracts that contribute to its financial stability and growth.

Bright Horizons Financial Statement Overview

Summary

Bright Horizons demonstrates a solid financial performance with strong revenue and profit growth, efficient operations, and prudent financial management. However, the relatively high debt-to-equity ratio suggests some leverage risk.

Income Statement

Bright Horizons has shown a strong upward trajectory in revenue growth, with a notable increase from previous years. The gross profit margin and net profit margin have also improved, indicating operational efficiency. The EBIT and EBITDA margins reflect solid profitability, contributing to a robust financial position.

Balance Sheet

The company's balance sheet shows a stable equity ratio, suggesting financial stability. While the debt-to-equity ratio has improved, indicating better leverage management, it remains relatively high, which could pose potential risks. Return on equity is healthy, reflecting good returns for shareholders.

Cash Flow

The cash flow statement highlights consistent free cash flow generation, supporting ongoing operations and investments. The operating cash flow to net income ratio indicates strong cash conversion, although there has been some fluctuation in free cash flow growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.73B	2.69B	2.42B	2.02B	1.76B	1.52B
Gross Profit	640.22M	619.61M	522.23M	405.91M	364.11M	227.65M
EBITDA	361.11M	344.54M	281.92M	265.27M	235.28M	160.41M
Net Income	161.25M	140.19M	74.05M	80.64M	70.46M	26.99M
Balance Sheet
Total Assets	3.82B	3.85B	3.90B	3.80B	3.64B	3.73B
Cash, Cash Equivalents and Short-Term Investments	112.05M	122.03M	93.57M	53.92M	260.98M	405.84M
Total Debt	1.75B	1.79B	1.86B	1.97B	1.78B	1.85B
Total Liabilities	2.50B	2.57B	2.68B	2.72B	2.46B	2.44B
Stockholders Equity	1.32B	1.28B	1.21B	1.08B	1.18B	1.28B
Cash Flow
Free Cash Flow	214.17M	240.15M	165.12M	117.92M	163.76M	124.83M
Operating Cash Flow	307.34M	337.46M	256.14M	188.47M	227.25M	209.57M
Investing Cash Flow	-94.26M	-117.76M	-126.94M	-278.05M	-117.39M	-83.83M
Financing Cash Flow	-159.59M	-183.81M	-91.63M	-121.34M	-230.03M	229.00M

Bright Horizons Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 120.58
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BFAM, the sentiment is Negative. The current price of 120.58 is below the 20-day moving average (MA) of 123.15, below the 50-day MA of 124.02, and below the 200-day MA of 122.78, indicating a bearish trend. The MACD of -0.98 indicates Positive momentum. The RSI at 41.35 is Neutral, neither overbought nor oversold. The STOCH value of 41.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BFAM.

Bright Horizons Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SCI	76 Outperform	$11.64B	22.53	32.71%	1.57%	2.40%	4.07%
CSV	75 Outperform	$736.16M	15.69	22.96%	0.96%	5.02%	45.34%
BFAM	73 Outperform	$6.90B	43.59	12.63%	―	9.71%	94.22%
Sector *	66 Neutral	£1.86B	11.27	6.18%	3.11%	0.61%	-17.57%

Bright Horizons Corporate Events

Bright Horizons Announces New Share Repurchase Program

On June 3, 2025, Bright Horizons held its annual shareholder meeting, where all director nominees were elected, the 2024 executive compensation was approved, and Deloitte & Touche LLP was ratified as the independent accounting firm for 2025. Additionally, the Board authorized a new $500 million share repurchase program, replacing the previous $400 million authorization, allowing the company to buy back shares at management’s discretion without an expiration date.

The most recent analyst rating on (BFAM) stock is a Buy with a $137.00 price target. To see the full list of analyst forecasts on Bright Horizons stock, see the BFAM Stock Forecast page.