Franklin Covey Company (FC) AI Stock Analysis

• Market Cap: $205.17M
• Dividend Yield: N/A
• Average Volume (3M): 135.21K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.27
• Revenue Growth: -7.02%
• EPS Growth: -86.27%
• Country: US
• Employees: 1,084
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Consulting Services
• EPS (TTM): -0.27
• Shares Outstanding: 11,552,552
• 10 Day Avg. Volume: 113,281
• 30 Day Avg. Volume: 135,205
• PEG Ratio: -0.95
• Price to Book (P/B): 3.78
• Price to Sales (P/S): 0.95
• P/FCF Ratio: 20.92
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 0.73
• Enterprise Value/Gross Profit: 0.97
• Enterprise Value/Ebitda: 20.09
• 1Y Price Target: $28.33
• Price Target Upside: 59.52% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 0.83
• Revenue Forecast (FY): $267.12M

• Rating: 58 Neutral
• Price Target: $18.50 ▲(4.17% Upside)

The score is held back mainly by weakened profitability and sharply lower free cash flow despite strong gross margins and a low-leverage balance sheet. Technicals are supportive but appear overextended, while valuation is weak due to negative earnings. Reaffirmed guidance and improving invoiced/deferred revenue trends provide some offset, but near-term financial headwinds remain prominent.

Positive Factors

High gross margins (~76%)

Sustained ~76% gross margins indicate durable pricing power and scalable digital/training content economics. High gross margin cushions operating profits against revenue cyclicality and supports long‑term margin recovery if SG&A is managed, preserving cash generation potential over 2–6 months.

Low leverage, conservative balance sheet

Very low debt relative to equity reduces financial risk and interest burden, giving management flexibility to absorb short‑term cash flow swings, invest in go‑to‑market changes, sustain buybacks, or access revolver liquidity without forcing asset sales or dilutive financing.

Improving invoiced and new‑logo momentum

A 25% increase in new‑logo subscription invoiced amounts plus rising services bookings and subscriptions signals durable demand from a retooled go‑to‑market. Growing contracted and invoiced flows underpin recurring revenue expansion and provide a runway for reported revenue and EBITDA growth into FY27.

Negative Factors

Profitability compressed to near breakeven

The shift from prior elevated operating margins to near‑breakeven TTM performance suggests cost base or revenue mix issues. Persistent low operating income limits reinvestment, slows ROE recovery, and makes multi‑period margin normalization dependent on sustained revenue improvement and cost control.

Sharp drop in free cash flow (~82% TTM)

An ~82% TTM decline in free cash flow despite positive operating cash flow highlights weakened cash conversion and working‑capital or nonrecurring outflows. Reduced FCF constrains discretionary spending, share repurchases, and leaves less buffer for reinvestment absent drawing on revolver liquidity.

International headwinds and revenue recognition timing risk

China and other international pressures create structural revenue volatility in segments reliant on licensees. Separately, multiyear services invoicing and ~$5.6M of committed services create timing risk that can shift reported revenue and cash between fiscal years, complicating predictability.

Franklin Covey Company Business Overview & Revenue Model

Company Description

Franklin Covey Co. provides training and consulting services in the areas of execution, sales performance, productivity, customer loyalty, and educational improvement for organizations and individuals worldwide. The company operates through three segments: Direct Offices, International Licensees, and Education Practice. It also provides a suite of individual-effectiveness and leadership-development training and products. The company was incorporated in 1983 and is headquartered in Salt Lake City, Utah.

How the Company Makes Money

Franklin Covey generates revenue through several key channels. Its primary revenue streams include corporate training programs, workshops, and consulting services, which cater to organizations seeking to improve employee performance and leadership skills. Additionally, the company earns income from the sale of books, online courses, and digital learning resources. FC has established significant partnerships with various corporations and educational institutions that facilitate the delivery of its training programs. Furthermore, the company offers subscription-based access to its digital learning platforms, which provides a recurring revenue model. By diversifying its offerings and leveraging its intellectual property, Franklin Covey effectively capitalizes on the growing demand for personal and professional development solutions.

Franklin Covey Company Financial Statement Overview

Summary

Strong gross margin (~76%) and a conservative, low-debt balance sheet support resilience, but TTM profitability has deteriorated to near-breakeven and free cash flow has fallen sharply (down ~82% TTM), weakening near-term earnings and cash generation quality.

Income Statement

TTM (Trailing-Twelve-Months) revenue is slightly down (-1.9%) and profitability has weakened materially versus prior annual periods, with a small net loss and low operating margin. That said, gross margin remains very strong and stable (~76%), indicating solid underlying pricing/premium content economics. The main drawback is the sharp step-down from FY2024’s much higher operating and net profitability to near-breakeven TTM results, raising questions on cost discipline and near-term earnings power.

Balance Sheet

The balance sheet is conservatively positioned with very low debt relative to equity in both TTM (Trailing-Twelve-Months) and the latest annual period, which meaningfully reduces financial risk and interest burden. Equity is positive and sizeable, supporting resilience. The key watch-out is that returns on equity have fallen sharply from prior years’ elevated levels, consistent with the recent profitability compression.

Cash Flow

TTM (Trailing-Twelve-Months) cash generation is mixed: operating cash flow remains positive, but free cash flow has dropped sharply (down ~82% TTM) versus the prior annual period. Cash conversion has also weakened versus the strong prior-year profile where free cash flow was a large share of earnings. The positive is that the company is still producing cash from operations, but the steep decline in free cash flow suggests pressure from working capital, investment needs, or reduced operating profitability.

Breakdown	TTM	Aug 2025	Aug 2024	Aug 2023	Aug 2022	Aug 2021
Income Statement
Total Revenue	262.03M	267.07M	287.23M	280.52M	262.84M	224.17M
Gross Profit	197.45M	203.57M	221.07M	213.49M	201.91M	172.90M
EBITDA	9.57M	14.43M	46.25M	39.98M	38.17M	23.82M
Net Income	-1.40M	3.07M	23.40M	17.78M	18.43M	13.62M
Balance Sheet
Total Assets	221.26M	242.91M	261.54M	245.92M	259.15M	249.65M
Cash, Cash Equivalents and Short-Term Investments	17.52M	31.70M	48.66M	38.23M	60.52M	47.42M
Total Debt	831.00K	7.82M	6.03M	15.33M	24.26M	32.86M
Total Liabilities	167.25M	176.00M	178.40M	167.26M	176.34M	169.79M
Stockholders Equity	54.01M	66.91M	83.14M	78.65M	82.81M	79.86M
Cash Flow
Free Cash Flow	3.29M	12.09M	56.56M	22.19M	46.92M	42.07M
Operating Cash Flow	14.93M	28.98M	60.26M	35.74M	52.25M	46.18M
Investing Cash Flow	-17.88M	-16.89M	-11.31M	-13.55M	-5.33M	-14.31M
Financing Cash Flow	-32.59M	-28.78M	-38.66M	-44.18M	-32.67M	-11.48M

Franklin Covey Company Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 17.76
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FC, the sentiment is Negative. The current price of 17.76 is below the 20-day moving average (MA) of 19.90, below the 50-day MA of 18.31, and below the 200-day MA of 19.35, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 36.63 is Neutral, neither overbought nor oversold. The STOCH value of 7.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FC.

Franklin Covey Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CRAI	78 Outperform	$1.02B	18.67	27.83%	0.97%	8.69%	34.58%
HURN	75 Outperform	$2.16B	21.01	21.20%	―	12.50%	29.40%
ICFI	74 Outperform	$1.42B	14.51	9.88%	0.65%	-3.81%	-7.05%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
FC	58 Neutral	$205.17M	-149.75	-2.08%	―	-7.02%	-86.27%
RGP	47 Neutral	$129.65M	-0.96	-61.44%	6.74%	-10.83%	-1669.11%
FORR	42 Neutral	$106.61M	-0.89	-43.39%	―	-8.73%	-1168.15%

Franklin Covey Company Corporate Events

Franklin Covey Shareholders Back Board, Pay and Auditor

At its Annual Meeting of Shareholders held on January 23, 2026, Franklin Covey Co. reported that shareholders elected all nominated directors, including Anne H. Chow, Craig Cuffie, Donald J. McNamara, Nancy Phillips, Efrain Rivera, Derek C.M. van Bever, Paul S. Walker, and Robert A. Whitman, to serve until the next annual meeting or until their successors are elected and qualified. Shareholders also approved, on an advisory basis, the company’s executive compensation program and ratified the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending August 31, 2026, signaling continued investor support for the current leadership, pay practices, and audit oversight framework.

The most recent analyst rating on (FC) stock is a Hold with a $21.00 price target. To see the full list of analyst forecasts on Franklin Covey Company stock, see the FC Stock Forecast page.

Franklin Covey Posts Q1 Loss But Reaffirms 2026 Outlook

On December 22, 2025, Franklin Covey reported its fiscal first-quarter 2026 results for the period ended November 30, 2025, posting consolidated revenue of $64.0 million, down from $69.1 million a year earlier, and shifting from net income of $1.2 million to a net loss of $3.3 million, as Adjusted EBITDA fell to $3.7 million from $7.7 million. Enterprise Division revenue declined to $47.5 million amid macroeconomic uncertainty, geopolitical trade tensions and canceled U.S. federal contracts, although invoiced amounts in Enterprise North America rose 7% (13% excluding government business) and deferred subscription revenue in that division climbed 7%, while Education Division revenue dipped slightly to $16.1 million as higher training, coaching and subscription sales were offset by lower materials revenue. Despite weaker cash generation—free cash flow swung to negative $3.7 million and cash balances fell to $17.5 million—liquidity remained above $80 million with no credit facility drawdowns, and the company repurchased about 624,000 shares for $11.1 million and reaffirmed its fiscal 2026 guidance of $265 million–$275 million in revenue and $28 million–$33 million in Adjusted EBITDA, signaling management’s confidence that its completed go-to-market transition and cost actions will drive stronger invoiced growth and improved results from the back half of 2026 into 2027.

The most recent analyst rating on (FC) stock is a Buy with a $38.00 price target. To see the full list of analyst forecasts on Franklin Covey Company stock, see the FC Stock Forecast page.

Franklin Covey to Announce Fiscal Q1 2026 Results

Franklin Covey Co. announced plans to release its fiscal first-quarter 2026 financial results after the market closes on Wednesday, January 7, 2026, followed by a conference call that same day at 5:00 p.m. ET to review the numbers. The company will offer investors and other interested parties access to the discussion via a live webcast and a pre-registered telephone option, with an archived replay available on its website for at least 30 days, underscoring its ongoing efforts to maintain transparency and engagement with stakeholders around its financial performance.

The most recent analyst rating on (FC) stock is a Buy with a $38.00 price target. To see the full list of analyst forecasts on Franklin Covey Company stock, see the FC Stock Forecast page.