Educational Development (EDUC) AI Stock Analysis

• Market Cap: $12.26M
• Dividend Yield: N/A
• Average Volume (3M): 32.92K
• Price to Earnings (P/E): 3.0
• Beta (1Y): 0.46
• Revenue Growth: -30.65%
• EPS Growth: -62.03%
• Country: US
• Employees: 101
• Sector: Communication Services
• Sector Strength: 97
• Industry: Publishing
• EPS (TTM): 0.91
• Shares Outstanding: 8,511,364
• 10 Day Avg. Volume: 25,652
• 30 Day Avg. Volume: 32,925
• PEG Ratio: <0.01
• Price to Book (P/B): 0.30
• Price to Sales (P/S): 0.35
• P/FCF Ratio: 4.33
• Enterprise Value/Market Cap: 1.22
• Enterprise Value/Revenue: 0.60
• Enterprise Value/Gross Profit: 0.98
• Enterprise Value/Ebitda: 1.66
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 58 Neutral
• Price Target: $1.50 ▲(4.17% Upside)

The score is held back primarily by weak operating performance (steep revenue/partner declines and underlying losses) despite meaningful balance-sheet improvement from debt elimination. Technicals are moderately supportive and valuation is very low, but both appear to reflect elevated business risk highlighted on the latest call.

Positive Factors

Balance Sheet Strength

The company materially reduced bank debt via an asset sale and now reports minimal leverage, removing covenant constraints and improving liquidity. This durable balance-sheet repair increases financial flexibility, lowers interest burden, and supports funding of product restocks and strategic initiatives over the next few quarters.

High Gross Margins

Sustained gross margins above 60% indicate structural product economics that can support profitability as scale returns. High product margins provide room to absorb marketing, distribution, or promotional spend while protecting unit economics, aiding recovery even if top-line growth is gradual.

New Product & Efficiency Initiatives

Introducing Gathered Goods and forming an AI task force represent structural changes: a higher-margin, scalable product channel plus automation to reduce SG&A. If execution holds, these initiatives can diversify revenue, improve margin mix, and reduce recurring costs over the medium term.

Negative Factors

Steep Revenue Decline

Multi-year and recent sharp revenue declines weaken scale economics and pressure fixed-cost coverage. Prolonged top-line contraction undermines reinvestment capacity, reduces bargaining leverage with partners, and makes achieving durable profitability dependent on sustained partner reactivation and successful new-title performance.

Collapse in Brand Partner Base

Losing more than half of active sellers is a structural distribution setback: even if remaining partners are more productive, a much smaller seller base limits market reach, slows organic customer acquisition, raises concentration risk, and makes revenue recovery contingent on difficult recruitment and retention efforts.

Underlying Operating Losses

Reported profitability is heavily aided by a one-time asset sale; core operations remain loss-making. Persistent underlying losses reduce internal funding for growth initiatives, increase dependence on external financing or asset monetization, and raise execution risk for strategic programs intended to restore durable growth.

Educational Development Business Overview & Revenue Model

Company Description

Educational Development Corporation, a publishing company, operates as a trade co-publisher of educational children's books in the United States. It operates through two segments, Publishing and Usborne Books & More (UBAM). The company offers various books, including touchy-feely board books, activity books and flashcards, adventure and search books, art books, sticker books, and foreign language books, as well as internet-linked books comprising science and math titles, and chapter books and novels. Educational Development Corporation markets its products to retail accounts, which include book, school supply, toy and gift stores and museums, through commissioned sales representatives, trade and specialty wholesalers, and its internal tele-sales group; and through a network of independent sales consultants through internet sales, direct sales, home shows, and book fairs. Educational Development Corporation was incorporated in 1965 and is headquartered in Tulsa, Oklahoma.

How the Company Makes Money

EDUC generates revenue through multiple streams, primarily by selling educational products directly to schools, educators, and parents. The company offers a range of products, including printed books, digital learning platforms, and classroom supplies, which are sold through both online and physical retail channels. Additionally, EDUC monetizes its resources through subscription-based services that provide access to exclusive digital content and tools for educators. Partnerships with educational institutions and organizations help increase their market reach and drive sales, while promotional campaigns and seasonal discounts further boost revenue during peak buying periods. Overall, EDUC's diverse product offerings and strategic partnerships play a crucial role in its financial success.

Educational Development Financial Statement Overview

Summary

Financials are mixed: the balance sheet is materially stronger after major debt reduction (low leverage), but operating fundamentals remain weak with multi-year revenue contraction, recent negative operating profit, and volatile cash flow (TTM positive but sharply lower YoY).

Income Statement

Results show a sharp downcycle: revenue has fallen materially from FY2021 to FY2025 and is down again in TTM (Trailing-Twelve-Months) (about -14.9%). Profitability is mixed—gross margin remains solid (~60%+), but operating performance is weak with negative EBIT/EBITDA in the most recent periods. While TTM (Trailing-Twelve-Months) net income is positive, the prior annual period posted a sizable loss, highlighting earnings volatility and lower quality of profits.

Balance Sheet

The balance sheet has improved meaningfully, driven by substantial debt reduction: total debt declined from roughly $45.5M (FY2023) to ~$6.9M in TTM (Trailing-Twelve-Months), taking leverage down to a low level (debt-to-equity ~0.15). Equity remains sizable relative to assets, which supports financial flexibility. The key weakness is inconsistent returns for shareholders (negative ROE in FY2023/FY2025 annual), reflecting that the stronger balance sheet has not consistently translated into stable profitability.

Cash Flow

Cash generation has been inconsistent across the cycle. TTM (Trailing-Twelve-Months) operating cash flow and free cash flow are positive, but free cash flow is down sharply year-over-year (about -50.9%), indicating weakening cash conversion recently. Several periods show a disconnect between earnings and cash results (including very weak cash flow in FY2023 and negative operating/free cash flow in FY2022), which raises some reliability concerns despite the current positive run-rate.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	34.19M	51.03M	87.83M	142.23M	204.64M
Gross Profit	21.03M	32.98M	56.07M	97.93M	144.60M
EBITDA	-2.94M	5.98M	1.22M	14.28M	19.43M
Net Income	-5.26M	546.40K	-2.50M	8.31M	12.62M
Balance Sheet
Total Assets	78.31M	90.11M	99.94M	109.93M	88.85M
Cash, Cash Equivalents and Short-Term Investments	428.40K	844.50K	689.10K	361.20K	1.81M
Total Debt	32.40M	35.55M	46.35M	43.17M	16.23M
Total Liabilities	37.75M	44.65M	54.70M	63.17M	48.59M
Stockholders Equity	40.57M	45.45M	45.23M	46.77M	40.26M
Cash Flow
Free Cash Flow	2.77M	7.93M	-1.52M	-24.86M	3.67M
Operating Cash Flow	3.21M	8.75M	58.50K	-21.14M	7.82M
Investing Cash Flow	-429.60K	4.04M	-1.76M	-3.94M	-4.15M
Financing Cash Flow	-3.08M	-12.20M	2.03M	23.63M	-4.86M

Educational Development Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.44
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EDUC, the sentiment is Positive. The current price of 1.44 is above the 20-day moving average (MA) of 1.36, above the 50-day MA of 1.33, and above the 200-day MA of 1.31, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 67.76 is Neutral, neither overbought nor oversold. The STOCH value of 67.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EDUC.

Educational Development Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SCHL	65 Neutral	$862.47M	-175.80	-0.35%	2.78%	2.53%	-23.86%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
EDUC	58 Neutral	$12.26M	3.04	-11.27%	―	-30.65%	-62.03%
LEE	52 Neutral	$30.91M	-0.81	―	―	-8.02%	-44.34%

Educational Development Corporate Events

Educational Development Posts Q3 Results Amid Strategic Asset Sale

On January 8, 2026, Educational Development Corporation reported fiscal 2026 third-quarter results for the period ended November 30, 2025, highlighting a sharp revenue decline alongside an accounting boost from asset sales. Net revenues fell to $7.0 million from $11.1 million in the quarter, and to $18.7 million from $27.6 million year-to-date, with average active PaperPie brand partners dropping to 5,100 from 12,400 in the quarter and to 6,200 from 13,300 year-to-date, underscoring continued sales and field-force pressure. Despite this, the company swung to reported pre-tax earnings of $10.6 million for the quarter and $7.4 million year-to-date, versus losses a year earlier, driven by a $32.2 million strategic sale-and-leaseback of its headquarters and distribution complex, which generated a $12.2 million gain; excluding this, it still posted pre-tax losses of $1.6 million for the quarter and $4.8 million year-to-date. Management emphasized that using the sale proceeds to fully repay term and revolving bank debt, reducing inventory by $1.5 million, and ending bank operating restrictions has improved annual cash flow by an estimated $1.0 million, lifted cash on the balance sheet to $3.4 million, and provided liquidity expected to support operations into fiscal 2027 while allowing renewed investment in new titles and efforts to reignite growth in the PaperPie division.

The most recent analyst rating on (EDUC) stock is a Hold with a $1.50 price target. To see the full list of analyst forecasts on Educational Development stock, see the EDUC Stock Forecast page.

Educational Development Schedules Q3 Earnings Call

On December 11, 2025, Educational Development Corporation announced that its fiscal year 2026 third quarter earnings call will take place on January 8, 2026. The event will feature presentations by key executives and a live Q&A session, providing insights into the company’s quarterly performance and future outlook.

The most recent analyst rating on (EDUC) stock is a Hold with a $1.50 price target. To see the full list of analyst forecasts on Educational Development stock, see the EDUC Stock Forecast page.

Educational Development Repays Debt, Ends Credit Agreement

On October 27, 2025, Educational Development Corporation fully repaid its outstanding debt and terminated its Credit Agreement with BOKF, NA, using proceeds from the sale of its headquarters and distribution warehouse for $32.2 million. This strategic move eliminated the company’s bank borrowings, improved its cash flow by approximately $1 million annually, and strengthened its financial position, benefiting shareholders and enhancing its balance sheet.

The most recent analyst rating on (EDUC) stock is a Hold with a $1.50 price target. To see the full list of analyst forecasts on Educational Development stock, see the EDUC Stock Forecast page.