Bright Horizons (BFAM) AI Stock Analysis

• Market Cap: $5.83B
• Dividend Yield: N/A
• Average Volume (3M): 663.38K
• Price to Earnings (P/E): 33.5
• Beta (1Y): 0.57
• Revenue Growth: 9.25%
• EPS Growth: 74.86%
• Country: US
• Employees: 32,050
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Personal Products & Services
• EPS (TTM): 1.07
• Shares Outstanding: 56,871,853
• 10 Day Avg. Volume: 598,982
• 30 Day Avg. Volume: 663,385
• 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: 1.49
• Enterprise Value/Revenue: 3.11
• Enterprise Value/Gross Profit: 13.14
• Enterprise Value/Ebitda: 23.11
• 1Y Price Target: $133.83
• Price Target Upside: 31.26% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 71 Outperform
• Price Target: $114.00 ▲(11.81% Upside)

Bright Horizons' strong financial performance and positive earnings call are significant strengths, highlighting robust growth and strategic expansions. However, the stock's technical indicators suggest a bearish trend, and its high P/E ratio indicates potential overvaluation. The absence of a dividend yield further impacts its valuation appeal.

Positive Factors

Revenue Growth

The company's consistent revenue and EPS growth indicate strong market demand and effective business strategies, supporting long-term financial health.

Cash Flow Management

Effective cash flow management provides the company with financial flexibility to invest in growth opportunities and sustain operations, enhancing resilience.

Strategic Expansions

Strategic expansions and positive guidance reflect the company's ability to capitalize on market opportunities and drive future growth.

Negative Factors

Operational Efficiencies

While profitable, the need for improved operational efficiencies and high debt levels may limit the company's ability to optimize margins and reduce financial risk.

Center Closures

Center closures suggest challenges in maintaining operational scale and could impact revenue growth if not addressed, posing a risk to expansion plans.

Occupancy Challenges

Low occupancy rates indicate underutilization of resources, which can strain profitability and hinder the company's ability to achieve optimal financial performance.

Bright Horizons Business Overview & Revenue Model

Company Description

Bright Horizons Family Solutions (BFAM) is a leading provider of child care and early education services, operating primarily in the United States and internationally. The company specializes in offering high-quality child care, early education programs, and back-up care solutions for working families. With a focus on enriching learning environments and supporting family needs, Bright Horizons serves a wide range of clients, including employers, families, and educational institutions.

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 showcases a sound financial position with consistent revenue and profit growth, effective equity utilization, and strong cash flow management. While operational efficiency can be enhanced, and debt levels are notable, the company's financial health remains strong, positioning it well for future growth opportunities.

Income Statement

Bright Horizons has demonstrated a robust revenue growth trajectory, with a notable increase from previous years. The TTM Gross Profit Margin is 23.67%, and the Net Profit Margin is 8.82%, both showing healthy profitability. Revenue growth is strong at 3.88% from the previous year, reflecting resilience and market demand. The EBIT Margin at 10.25% and EBITDA Margin at 10.40% indicate efficient operations, although there is room for improvement in operational efficiencies.

Balance Sheet

The company's Debt-to-Equity Ratio has improved, currently at 0.61, indicating a stable capital structure. Return on Equity (ROE) is 17.59%, suggesting effective utilization of equity capital. The Equity Ratio is 35.69%, showing a balanced asset financing strategy. However, the company maintains a significant level of debt, which could pose a risk in less favorable market conditions.

Cash Flow

Bright Horizons exhibits strong cash flow management with a Free Cash Flow growth of 1.08% TTM. The Operating Cash Flow to Net Income Ratio is 1.35, indicating robust cash generation relative to net income. The Free Cash Flow to Net Income Ratio stands at 0.99, suggesting efficient conversion of net income to free cash flow. These metrics highlight solid liquidity and financial health, providing flexibility for future investments.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.79B	2.69B	2.42B	2.02B	1.76B	1.52B
Gross Profit	660.35M	619.61M	531.72M	478.65M	415.01M	304.55M
EBITDA	375.38M	344.54M	281.92M	257.81M	235.28M	165.00M
Net Income	176.85M	140.19M	74.05M	80.64M	70.46M	26.99M
Balance Sheet
Total Assets	3.92B	3.85B	3.90B	3.80B	3.64B	3.73B
Cash, Cash Equivalents and Short-Term Investments	179.22M	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	2.52B	2.57B	2.68B	2.72B	2.46B	2.44B
Stockholders Equity	1.40B	1.28B	1.21B	1.08B	1.18B	1.28B
Cash Flow
Free Cash Flow	242.75M	240.15M	165.12M	117.92M	163.76M	124.83M
Operating Cash Flow	332.09M	337.46M	256.14M	188.47M	227.25M	209.57M
Investing Cash Flow	-91.60M	-117.76M	-126.94M	-278.05M	-117.39M	-83.83M
Financing Cash Flow	-193.14M	-183.81M	-91.63M	-121.34M	-230.03M	229.00M

Bright Horizons Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 101.96
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 101.96 is below the 20-day moving average (MA) of 102.27, below the 50-day MA of 110.18, and below the 200-day MA of 118.81, indicating a bearish trend. The MACD of -2.44 indicates Negative momentum. The RSI at 43.06 is Neutral, neither overbought nor oversold. The STOCH value of 82.40 is Negative, 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	75 Outperform	$11.53B	22.07	34.52%	1.55%	2.65%	7.42%
BFAM	71 Outperform	$5.83B	33.55	13.19%	―	9.25%	74.86%
CSV	67 Neutral	$710.51M	13.58	24.38%	1.00%	3.55%	73.06%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Bright Horizons Corporate Events

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.

Bright Horizons Shines in Earnings Call with Strong Growth

Bright Horizons’ recent earnings call painted a picture of robust financial health, marked by significant revenue and EPS growth. The company is experiencing positive momentum in its full service and back-up care segments, alongside operational improvements in the U.K. However, challenges persist with center closures and the need to boost enrollment in certain centers. The increased guidance for the year underscores the company’s confidence in sustaining growth.

Bright Horizons Reports Strong Q2 2025 Results

Bright Horizons Family Solutions Inc. is a global provider of early education, child care, and workforce education services, catering to working families and client employees across various life and career stages.