Bright Horizons (BFAM) AI Stock Analysis

• Market Cap: $5.72B
• Dividend Yield: N/A
• Average Volume (3M): 906.83K
• Price to Earnings (P/E): 29.1
• Beta (1Y): 0.35
• Revenue Growth: 9.38%
• EPS Growth: 74.27%
• Country: US
• Employees: 32,050
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Personal Products & Services
• EPS (TTM): 1.57
• Shares Outstanding: 56,553,944
• 10 Day Avg. Volume: 795,919
• 30 Day Avg. Volume: 906,825
• PEG Ratio: 0.51
• Price to Book (P/B): 5.02
• Price to Sales (P/S): 2.39
• P/FCF Ratio: 26.74
• Enterprise Value/Market Cap: 1.37
• Enterprise Value/Revenue: 2.73
• Enterprise Value/Gross Profit: 11.29
• Enterprise Value/Ebitda: 19.19
• 1Y Price Target: $132.71
• Price Target Upside: 31.24% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): 4.52
• Revenue Forecast (FY): $2.93B

• Rating: 67 Neutral
• Price Target: $106.00 ▲(4.83% Upside)

Bright Horizons' strong earnings call performance, with significant revenue and EPS growth, is the most impactful factor, contributing positively to the overall score. Financial performance shows stability with room for improvement, while technical analysis indicates a bearish trend. The valuation is moderate, with no dividend yield to enhance attractiveness.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for services and effective business strategies, supporting long-term expansion and profitability.

Back-Up Care Segment Success

The success in the back-up care segment highlights a growing market need and positions the company to capitalize on this demand, enhancing revenue stability.

Positive Outlook for Full Year

An upgraded full-year outlook reflects management's confidence in sustained growth and operational execution, supporting long-term strategic goals.

Negative Factors

Moderate Enrollment Growth

Moderate enrollment growth may limit revenue potential and suggests challenges in attracting new clients, impacting future growth prospects.

Potential Impact from Client Layoffs

Client layoffs could reduce demand for services, affecting revenue and highlighting potential vulnerabilities in the business model.

Significant Debt Levels

High debt levels can strain financial flexibility and increase risk, potentially impacting the company's ability to invest in growth opportunities.

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 through several key streams. The primary source of income comes from tuition fees charged for child care and early education services provided at their centers. The company also earns revenue through employer-sponsored child care programs, where organizations partner with Bright Horizons to offer subsidized child care options to their employees. Additionally, the company provides back-up care services for families needing temporary child care, contributing further to its earnings. Strategic partnerships with corporations and educational institutions enhance its revenue model by expanding its client base and service offerings, while also leveraging contracts with employers to provide comprehensive family care solutions.

Bright Horizons Financial Statement Overview

Summary

Bright Horizons demonstrates solid revenue growth and improved profitability metrics, with a notable enhancement in leverage management. While the cash flow position shows some weaknesses, the overall financial health is stable with potential for further improvement in profitability and cash flow generation.

Income Statement

Bright Horizons shows a consistent revenue growth trajectory with a 3% increase in the TTM period. The gross profit margin has improved to 24.2%, indicating efficient cost management. However, the net profit margin remains modest at 7%, suggesting room for profitability enhancement. The EBIT margin has slightly decreased, but the EBITDA margin remains stable, reflecting operational resilience.

Balance Sheet

The company's debt-to-equity ratio has improved significantly to 0.58 in the TTM period, indicating better leverage management. Return on equity has increased to 24.3%, showcasing strong shareholder returns. The equity ratio suggests a stable financial structure, but the high historical leverage poses a potential risk if not managed carefully.

Cash Flow

Free cash flow has decreased by 4.23% in the TTM period, which is a concern for liquidity. However, the operating cash flow to net income ratio remains healthy, indicating good cash generation relative to net income. The free cash flow to net income ratio is strong at 71.9%, suggesting efficient cash utilization.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.87B	2.69B	2.42B	2.02B	1.76B	1.52B
Gross Profit	694.39M	619.61M	531.72M	478.65M	415.01M	304.55M
EBITDA	408.37M	344.54M	281.92M	257.81M	235.28M	165.00M
Net Income	200.50M	140.19M	74.05M	80.64M	70.46M	26.99M
Balance Sheet
Total Assets	3.88B	3.85B	3.90B	3.80B	3.64B	3.73B
Cash, Cash Equivalents and Short-Term Investments	116.60M	122.03M	93.57M	53.92M	283.69M	405.84M
Total Debt	1.75B	1.79B	1.86B	1.97B	1.78B	1.85B
Total Liabilities	2.46B	2.57B	2.68B	2.72B	2.46B	2.44B
Stockholders Equity	1.43B	1.28B	1.21B	1.08B	1.18B	1.28B
Cash Flow
Free Cash Flow	232.48M	240.15M	165.12M	117.92M	163.76M	124.83M
Operating Cash Flow	323.44M	337.46M	256.14M	188.47M	227.25M	209.57M
Investing Cash Flow	-88.59M	-117.76M	-126.94M	-278.05M	-117.39M	-83.83M
Financing Cash Flow	-230.83M	-183.81M	-91.63M	-121.34M	-230.03M	229.00M

Bright Horizons Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 101.12
• 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 BFAM, the sentiment is Neutral. The current price of 101.12 is above the 20-day moving average (MA) of 99.43, below the 50-day MA of 102.33, and below the 200-day MA of 116.82, indicating a neutral trend. The MACD of -0.88 indicates Negative momentum. The RSI at 51.21 is Neutral, neither overbought nor oversold. The STOCH value of 59.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BFAM.

Bright Horizons Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SCI	71 Outperform	$11.20B	21.54	33.48%	1.54%	3.41%	7.94%
BFAM	67 Neutral	$5.72B	29.12	14.19%	―	9.38%	74.27%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
CSV	54 Neutral	$666.34M	13.60	21.96%	1.06%	0.99%	37.55%

Bright Horizons Corporate Events

Bright Horizons Shines with Strong Earnings Call

Bright Horizons’ recent earnings call painted a positive picture for the company, with strong revenue and EPS growth leading the charge. The upbeat sentiment was bolstered by significant success in the back-up care segment and positive developments in the U.K. business. However, there were some concerns regarding moderate enrollment growth in full service and potential impacts from client layoffs.

Bright Horizons Reports Strong Q3 2025 Growth

Bright Horizons Family Solutions Inc. is a global provider of early education, child care, and workforce education services, partnering with employers to support working families and employees across various life and career stages. The company reported strong financial results for the third quarter of 2025, with significant increases in revenue and net income compared to the same period in 2024. Revenue for the third quarter reached $803 million, marking a 12% increase, while net income rose by 43% to $79 million. The company attributes its growth to higher utilization of back-up care services and improvements in enrollment and margins in its full-service center-based child care segment. Adjusted EBITDA also saw a notable increase of 29%, reaching $156 million. Looking forward, Bright Horizons remains optimistic about its growth prospects, supported by its diverse offerings and extensive network of client partners, as it heads into 2026.

Bright Horizons Secures New $450M Loan Facility

On August 21, 2025, Bright Horizons Family Solutions LLC amended its existing credit agreement to establish a new $450 million term ‘B’ loan facility, which refinances previous loans. This financial restructuring aims to optimize the company’s debt profile, with the new loan maturing in 2032, potentially enhancing Bright Horizons’ financial stability and operational flexibility.

The most recent analyst rating on (BFAM) stock is a Buy with a $135.00 price target. To see the full list of analyst forecasts on Bright Horizons stock, see the BFAM Stock Forecast page.