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Bright Horizons
(NYSE:BFAM)
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Rating:68Neutral
Price Target:
$80.00
▼(-5.62% Downside)
Action:Reiterated
Date:06/04/26
The score is supported primarily by improving fundamentals (growth, margin trajectory, and solid free cash flow) and a generally constructive earnings outlook with reaffirmed guidance. It is held back by weak technicals (clear downtrend despite oversold signals) and ongoing leverage-related and Australia-driven margin/EPS risks.
Positive Factors
Backup Care growth
Sustained double-digit Backup Care growth reflects recurring employer contracts and scalable program delivery. Low current penetration (<5%) and an elevated full-year margin target (28%–30%) imply durable revenue runway and a path to higher structural profitability and cash generation as utilization expands.
Negative Factors
Elevated leverage
A historically sizable debt load and near-2.0x net leverage constrain financial flexibility and raise sensitivity to higher rates or weaker cash flow. Tightening covenants from amended facilities increase limits on dividends/investments, making the company more exposed to cyclical headwinds over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Backup Care growth
Sustained double-digit Backup Care growth reflects recurring employer contracts and scalable program delivery. Low current penetration (<5%) and an elevated full-year margin target (28%–30%) imply durable revenue runway and a path to higher structural profitability and cash generation as utilization expands.
Read all positive factors
Bright Horizons Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down sales across regions (such as U.S. vs. international), showing where growth comes from and where the business is exposed to local labor markets, regulations and currency moves. For Bright Horizons, a heavy U.S. mix points to dependence on domestic employment trends while faster international growth can be a source of upside but may bring regulatory and execution risks.
Breaks down sales across regions (such as U.S. vs. international), showing where growth comes from and where the business is exposed to local labor markets, regulations and currency moves. For Bright Horizons, a heavy U.S. mix points to dependence on domestic employment trends while faster international growth can be a source of upside but may bring regulatory and execution risks.
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The Fly
The FlyBright Horizons (BFAM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.86B
Dividend YieldN/A
Average Volume (3M)1.05M
Price to Earnings (P/E)21.8
Beta (1Y)0.34
Revenue Growth9.22%
EPS Growth20.19%
CountryUS
Employees32,050
SectorConsumer Cyclical
Sector Strength84
IndustryPersonal Products & Services
Share Statistics
EPS (TTM)3.36
Shares Outstanding52,606,674
10 Day Avg. Volume786,813
30 Day Avg. Volume1,050,049
Financial Highlights & Ratios
PEG Ratio0.75
Price to Book (P/B)4.31
Price to Sales (P/S)1.97
P/FCF Ratio22.52
Enterprise Value/Market Cap1.32
Enterprise Value/Revenue1.71
Enterprise Value/Gross Profit7.29
Enterprise Value/Ebitda12.39
Forecast
1Y Price Target
$92.71Price Target Upside9.38% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)5.02
Revenue Forecast (FY)$3.10B
Bright Horizons Business Overview & Revenue Model
Company Description
Bright Horizons Family Solutions Inc., established in 1986 and headquartered in Newton, Massachusetts, offers a comprehensive suite of early education, child care, and workplace solutions designed for employers and their employees' families. The c...
How the Company Makes Money
Bright Horizons makes money primarily by delivering child care and other family support services under a mix of employer-sponsored and direct-to-consumer arrangements. A major revenue stream comes from its full-service child care centers, where fe...
Bright Horizons Earnings Call Summary
Earnings Call Date:May 05, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 04, 2026
Earnings Call Sentiment Positive
The call conveyed a largely positive operational and financial trajectory driven by strong Backup Care momentum, consolidated revenue and EPS growth, healthy free cash flow conversion, and proactive capital allocation (opportunistic buybacks). Management also reiterated full-year guidance and provided constructive Q2 visibility. However, meaningful headwinds from the Australia Full Service operations, portfolio rationalization (center closures), and near-term margin pressure temper the outlook. On balance, the highlights (notably Backup strength, cash generation, guidance reaffirmation, and go-to-market integration) outweigh the lowlights, though Australia remains a material watch item.Positive Updates
Consolidated Revenue and EPS Growth
Q1 revenue of $712 million, up 7% year-over-year; adjusted EPS of $0.82, up 6% and modestly ahead of guidance ($0.75–$0.80).
Negative Updates
Australia Enrollment Weakness and Earnings Drag
Australia operations materially underperformed: company estimates Australia full-year revenue ~ $140 million with losses of ~$20–$25 million. Management quantified Australia as ~150 basis points headwind to Full Service revenue profile and indicated Australia represents roughly a $0.40 EPS headwind when including tax impacts; Q1 experienced an elevated enrollment decline in 78 centers.
Read all updates
Q1-2026 Updates
Positive
Negative
Consolidated Revenue and EPS Growth
Q1 revenue of $712 million, up 7% year-over-year; adjusted EPS of $0.82, up 6% and modestly ahead of guidance ($0.75–$0.80).
Read all positive updates
Company Guidance
Management reaffirmed 2026 guidance calling for full-year revenue of $3.075B–$3.125B and adjusted EPS of $4.90–$5.10, while estimating full-year interest expense of $50M–$52M and an adjusted effective tax rate of 28.0%–28.5% (up ~100 bps); segment guidance includes Backup Care revenue growth of 12%–14% (Q1 Backup was $145M, up 12.5%, with Q1 margin 18% and a full-year margin target of 28%–30%), Full Service reported revenue growth of 2.5%–3.5% (with ~200 bps headwind from net center closings and ~100 bps from weaker Australia performance), and Education Advisory mid-single-digit growth; Q2 guidance calls for total top-line growth of 5.25%–6.5% (Full Service 2.5%–3.5%, Backup 15%–17%, Education Advisory low single digits) and adjusted EPS of $1.17–$1.22.Bright Horizons Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
62
Positive
Cash Flow
76
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.98B | 2.93B | 2.69B | 2.42B | 2.02B | 1.76B |
| Gross Profit | 700.88M | 691.05M | 619.61M | 531.72M | 478.65M | 415.01M |
| EBITDA | 412.10M | 408.07M | 344.54M | 281.92M | 257.81M | 235.28M |
| Net Income | 189.18M | 193.12M | 140.19M | 74.05M | 80.64M | 70.46M |
Balance Sheet | ||||||
| Total Assets | 3.79B | 4.15B | 3.85B | 3.90B | 3.80B | 3.64B |
| Cash, Cash Equivalents and Short-Term Investments | 148.61M | 155.98M | 122.03M | 93.57M | 53.92M | 283.69M |
| Total Debt | 1.87B | 1.76B | 1.79B | 1.86B | 1.97B | 1.78B |
| Total Liabilities | 2.65B | 2.81B | 2.57B | 2.68B | 2.72B | 2.46B |
| Stockholders Equity | 1.15B | 1.34B | 1.28B | 1.21B | 1.08B | 1.18B |
Cash Flow | ||||||
| Free Cash Flow | 273.02M | 256.36M | 240.15M | 165.12M | 117.92M | 163.76M |
| Operating Cash Flow | 369.22M | 347.68M | 337.46M | 256.14M | 188.47M | 227.25M |
| Investing Cash Flow | -108.76M | -103.79M | -117.76M | -126.94M | -278.05M | -117.39M |
| Financing Cash Flow | -250.29M | -230.38M | -183.81M | -91.63M | -121.34M | -230.03M |
Bright Horizons Technical Analysis
Neutral
84.76
Price Trends
68.58
Positive
73.65
Negative
86.25
Negative
Market Momentum
2.24
Negative
59.33
Neutral
62.12
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 84.76 is above the 20-day moving average (MA) of 69.35, above the 50-day MA of 68.58, and below the 200-day MA of 86.25, indicating a neutral trend. The MACD of 2.24 indicates Negative momentum. The RSI at 59.33 is Neutral, neither overbought nor oversold. The STOCH value of 62.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BFAM.
Bright Horizons Risk Analysis
Bright Horizons disclosed 29 risk factors in its most recent earnings report. Bright Horizons reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Bright Horizons Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $5.02B | 6.99 | -225.85% | 3.67% | 5.36% | 36.69% | |
72 Outperform | $5.29B | 21.21 | 99.90% | ― | 12.12% | 14.91% | |
68 Neutral | $3.86B | 21.76 | 14.25% | ― | 9.22% | 20.19% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
52 Neutral | $119.20M | -5.94 | -9.68% | ― | -36.31% | -184.77% | |
| ― | $5.15M | 0.02 | -1.53% | ― | -1.57% | ― | |
55 Neutral | $153.98M | 4.51 | 334.45% | ― | -9.61% | ― |
* Consumer Cyclical Sector Average
BFAM
Bright Horizons
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Bright Horizons Corporate Events
Executive/Board ChangesShareholder Meetings
Bright Horizons Shareholders Reaffirm Board and Governance Structure
Positive
Jun 3, 2026
At its June 3, 2026 annual meeting, Bright Horizons Family Solutions shareholders elected all six director nominees to one-year terms on the board, reaffirming the company’s existing leadership structure. Investors also cast an advisory vote...
Business Operations and StrategyPrivate Placements and Financing
Bright Horizons Expands Credit Facilities and Terms Debt
Positive
Jun 1, 2026
On June 1, 2026, Bright Horizons Family Solutions LLC amended its existing credit agreement to add $375 million in incremental term A loans maturing April 17, 2030 and to expand its revolving credit facility from $900 million to $1 billion, with i...
Business Operations and StrategyStock BuybackFinancial Disclosures
Bright Horizons Posts Solid Q1 2026 Results, Reaffirms Outlook
Positive
May 5, 2026
On May 5, 2026, Bright Horizons reported first-quarter 2026 results showing revenue of $712 million, up 7% year on year, with income from operations rising 4% but net income declining 10% to $34.1 million as higher taxes and interest offset operat...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.