KinderCare Learning Companies Inc (KLC)
NYSE:KLC
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KinderCare Learning Companies Inc
(NYSE:KLC)
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Rating:50Neutral
Price Target:
$3.50
▲(13.27% Upside)
Action:Reiterated
Date:05/16/26
The score is held back primarily by weak financial performance (large TTM losses and high leverage) despite positive cash flow. Technicals are moderately supportive with improving short-to-mid-term momentum, while valuation support is limited due to negative earnings. The latest earnings call was mixed: raised profitability guidance and operational initiatives offset by ongoing occupancy and profit pressure.
Positive Factors
Cash Generation
Consistent positive operating and free cash flow demonstrates the business converts revenue into cash despite GAAP losses. That durable cash generation supports working capital, targeted capex (~5% of revenue), acquisitions and debt servicing capacity over the next several quarters.
Negative Factors
High Leverage
A debt-heavy capital structure reduces financial flexibility and raises refinancing and interest-rate risk if operating performance lags. High leverage constrains strategic optionality and increases sensitivity to slower occupancy or cash-flow volatility over coming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Consistent positive operating and free cash flow demonstrates the business converts revenue into cash despite GAAP losses. That durable cash generation supports working capital, targeted capex (~5% of revenue), acquisitions and debt servicing capacity over the next several quarters.
Read all positive factors
KinderCare Learning Companies Inc (KLC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$423.97M
Dividend YieldN/A
Average Volume (3M)1.12M
Price to Earnings (P/E)―
Beta (1Y)1.51
Revenue Growth2.28%
EPS Growth-473.69%
CountryUS
Employees43,690
SectorConsumer Defensive
Sector Strength42
IndustryEducation & Training Services
Share Statistics
EPS (TTM)-3.58
Shares Outstanding118,428,300
10 Day Avg. Volume1,529,030
30 Day Avg. Volume1,117,115
Financial Highlights & Ratios
PEG Ratio4.19
Price to Book (P/B)0.65
Price to Sales (P/S)0.18
P/FCF Ratio4.46
Enterprise Value/Market Cap4.49
Enterprise Value/Revenue0.69
Enterprise Value/Gross Profit4.23
Enterprise Value/Ebitda6.84
Forecast
1Y Price Target
$4.51Price Target Upside45.95% Upside
Rating ConsensusHold
Number of Analyst Covering7
EPS Forecast (FY)0.19
Revenue Forecast (FY)$2.71B
KinderCare Learning Companies Inc Business Overview & Revenue Model
Company Description
KinderCare Learning Companies, Inc. provides early childhood education and care services in the United States. The company offers infant, toddler, preschool, kindergarten, and before- and after-school programs in various categories comprising comm...
How the Company Makes Money
KLC primarily makes money by charging tuition and care fees paid by families for enrollment in its childcare, preschool, and school-age programs at its centers; these recurring tuition payments typically represent the core revenue stream. The comp...
KinderCare Learning Companies Inc Earnings Call Summary
Earnings Call Date:May 14, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 18, 2026
Earnings Call Sentiment Neutral
The call balanced encouraging operational signs—targeted marketing lifts (+15% in targeted inquiries), early conversion improvements, strong Champions and B2B momentum, tightened portfolio actions and raised adjusted EBITDA guidance—against significant near-term financial and operational pressures: enrollment down ~3%, same-center occupancy down 310 bps YoY, sharply lower adjusted EBITDA and adjusted net income versus prior year, and a large noncash impairment driving a reported net loss. Management expressed confidence in execution and the back-half recovery but acknowledged that meaningful margin recovery depends on occupancy improvement and the outcome of portfolio optimization.Positive Updates
Modest Revenue Growth and Raised Full-Year Profit Guidance
Revenue of $673 million in Q1, described as up modestly year-over-year. Management raised full-year adjusted EBITDA guidance to $215 million–$235 million and adjusted EPS guidance to $0.15–$0.25, while maintaining revenue guidance of $2.7 billion–$2.75 billion.
Negative Updates
Enrollment Decline and Occupancy Pressure
Enrollment in ECE centers declined about 3% year-over-year (improved from a 3.6% decline in Q4). Same-center occupancy was 66%, up 150 basis points from Q4 but down 310 basis points versus Q1 last year, and management expects occupancy to remain a primary near-term pressure.
Read all updates
Q1-2026 Updates
Positive
Negative
Modest Revenue Growth and Raised Full-Year Profit Guidance
Revenue of $673 million in Q1, described as up modestly year-over-year. Management raised full-year adjusted EBITDA guidance to $215 million–$235 million and adjusted EPS guidance to $0.15–$0.25, while maintaining revenue guidance of $2.7 billion–$2.75 billion.
Read all positive updates
Company Guidance
KinderCare raised full‑year adjusted EBITDA and adjusted EPS guidance while keeping revenue guidance unchanged at $2.70–2.75 billion; it now expects adjusted EBITDA of $215–235 million and adjusted EPS of $0.15–0.25. Management continues to assume tuition contributes +3% and occupancy -3% (offsetting), expects Champions and B2B to add ~1% to revenue, and projects new center openings and acquisitions to each contribute ~50 basis points; CapEx is targeted at ~5% of revenue, free cash flow $35–40 million, and a modeled effective tax rate of 27%. Balance‑sheet and quarterly guide metrics include net debt/adjusted EBITDA just under 3x, $133 million cash, $190 million revolver capacity, and Q2 revenue and adjusted EBITDA guides of $690–700 million and $63–67 million, respectively. Notable Q1 figures referenced in the call: revenue $673 million, adjusted EBITDA $52 million (vs. $83M prior Y/Y), adjusted net income $4.2M/adj. EPS $0.04 (vs. $27M/$0.23 prior), reported net loss $290M/GAAP EPS -$2.45, same‑center occupancy 66% (down 310 bps YoY, up 150 bps QoQ), pricing contributed ~2% to ECE, and enrollment was down ~3% YoY.KinderCare Learning Companies Inc Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
38
Negative
Cash Flow
52
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.74B | 2.73B | 2.66B | 2.51B | 2.17B | 1.81B |
| Gross Profit | 449.67M | 481.23M | 630.52M | 685.86M | 444.20M | 368.30M |
| EBITDA | 278.10M | 307.96M | 209.91M | 391.86M | 176.91M | 141.22M |
| Net Income | -423.87M | -112.88M | -92.84M | 102.56M | 219.17M | 88.41M |
Balance Sheet | ||||||
| Total Assets | 3.44B | 3.75B | 3.65B | 3.65B | 3.66B | 3.47B |
| Cash, Cash Equivalents and Short-Term Investments | 132.87M | 133.21M | 62.34M | 156.15M | 105.21M | 177.25M |
| Total Debt | 1.61B | 2.53B | 2.39B | 2.69B | 2.86B | 2.89B |
| Total Liabilities | 2.97B | 2.99B | 2.78B | 3.15B | 3.26B | 3.21B |
| Stockholders Equity | 471.09M | 755.26M | 864.51M | 506.88M | 407.69M | 255.61M |
Cash Flow | ||||||
| Free Cash Flow | 36.25M | 110.26M | -16.43M | 174.50M | 202.18M | 116.40M |
| Operating Cash Flow | 171.15M | 238.53M | 115.89M | 303.54M | 341.61M | 183.29M |
| Investing Cash Flow | -154.68M | -154.42M | -147.24M | -117.66M | -299.73M | -80.15M |
| Financing Cash Flow | -14.98M | -13.25M | -62.63M | -134.94M | -117.66M | 20.87M |
KinderCare Learning Companies Inc Technical Analysis
Negative
3.09
Price Trends
3.12
Positive
3.67
Negative
4.82
Negative
Market Momentum
0.11
Positive
47.58
Neutral
12.67
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KLC, the sentiment is Negative. The current price of 3.09 is below the 20-day moving average (MA) of 3.91, below the 50-day MA of 3.12, and below the 200-day MA of 4.82, indicating a neutral trend. The MACD of 0.11 indicates Positive momentum. The RSI at 47.58 is Neutral, neither overbought nor oversold. The STOCH value of 12.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KLC.
KinderCare Learning Companies Inc Risk Analysis
KinderCare Learning Companies Inc disclosed 35 risk factors in its most recent earnings report. KinderCare Learning Companies Inc 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
KinderCare Learning Companies Inc Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $8.30B | 16.99 | 10.79% | 1.03% | 12.38% | 11.05% | |
68 Neutral | $944.69M | 14.66 | 14.02% | ― | 3.84% | 87.34% | |
66 Neutral | $1.54B | 72.68 | 11.72% | ― | 19.92% | 84.00% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
61 Neutral | $2.21B | 1,142.17 | 13.02% | ― | 11.03% | -26.34% | |
58 Neutral | $1.52B | -11.97 | -10.06% | ― | 9.79% | 8.61% | |
50 Neutral | $423.97M | -0.25 | -55.02% | ― | 2.28% | -473.69% |
* Consumer Defensive Sector Average
KLC
KinderCare Learning Companies Inc
3.58
-8.99
-71.52%
APEI
American Public Education
51.50
21.76
73.17%
LINC
Lincoln Edu
48.40
25.37
110.16%
EDU
New Oriental Education Tech
46.43
0.41
0.89%
UTI
Universal Technical Institute
40.06
4.30
12.02%
COUR
Coursera
5.32
-3.25
-37.92%
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.