KinderCare Learning Companies Inc (KLC) AI Stock Analysis

• Market Cap: $1.27B
• Dividend Yield: N/A
• Average Volume (3M): 570.75K
• Price to Earnings (P/E): 35.8
• Beta (1Y): 0.96
• Revenue Growth: 4.87%
• EPS Growth: -198.67%
• Country: US
• Employees: 43,690
• Sector: Consumer Defensive
• Sector Strength: 70
• Industry: Education & Training Services
• EPS (TTM): 0.23
• Shares Outstanding: 118,006,325
• 10 Day Avg. Volume: 516,731
• 30 Day Avg. Volume: 570,751
• PEG Ratio: 0.09
• Price to Book (P/B): 7.33
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 14.78
• Enterprise Value/Market Cap: 5.00
• Enterprise Value/Revenue: 1.22
• Enterprise Value/Gross Profit: 15.15
• Enterprise Value/Ebitda: 16.50
• 1Y Price Target: $20.50
• Price Target Upside: 90.88% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

• Rating: 55 Neutral
• Price Target: $10.50 ▼(-2.23%Downside)

KinderCare Learning Companies Inc faces significant financial and technical challenges despite having a promising earnings call. The company's high leverage and negative net income are major concerns, along with bearish technical indicators. While the earnings call indicated some positive growth prospects, the overall financial and market conditions weigh heavily on the stock's performance.

Positive Factors

Digital Tools

Key digital tools have been rolled out to improve operating performance and drive occupancy growth, including the Digital Occupancy White Board and Online Tour Scheduler.

Financial Flexibility

KinderCare expects to continue its center expansion strategy with acquisitions and new center openings without heavily relying on debt, improving its financial flexibility.

Revenue Growth

KinderCare is confident in its ability to achieve medium-term revenue growth targets, driven by pricing, B2B contributions, and M&A activities.

Negative Factors

Occupancy Levels

Occupancy took a step back as a result of the enrollment decline.

Revenue Expectations

Total revenue was below expectations, driven by lower-than-expected enrollments within ECE.

Revenue Guide

Guide of 5% revenue growth was just below MSe (5% organic) but 193bps below cons.

KinderCare Learning Companies Inc Business Overview & Revenue Model

Company Description

KinderCare Learning Companies Inc (KLC) is a leading provider of early childhood education and care services in the United States. The company operates a network of child care centers that offer educational programs for children ranging from infants to school-age. With a focus on fostering a nurturing and stimulating learning environment, KinderCare provides a variety of programs that support the developmental needs of young children and prepare them for future educational success.

How the Company Makes Money

KinderCare Learning Companies Inc makes money primarily through tuition and fees charged to parents for the enrollment of their children in its educational programs. These programs include full-time care, part-time care, and before-and-after school care, tailored to meet the needs of working families. The company also generates revenue from government subsidies and assistance programs that support families in need of child care services. Additionally, KinderCare may engage in partnerships with corporations to provide on-site child care services as part of employee benefits, further contributing to its revenue streams.

KinderCare Learning Companies Inc Financial Statement Overview

Summary

KinderCare Learning Companies Inc shows potential through revenue growth but faces challenges in profitability and financial stability. High leverage and negative net income pose risks, while negative free cash flow indicates cash management issues. The company needs to improve its operational efficiency and financial health to enhance shareholder value and sustain growth.

Income Statement

KinderCare Learning Companies Inc shows a mixed performance in its income statement. Despite a consistent increase in total revenue over the years, the company has recently reported a negative net income, indicating net losses. The gross profit margin is strong, suggesting effective cost management in producing services. However, the EBIT and net profit margins have declined, showing challenges in maintaining operational efficiency and profitability. The revenue growth rate is positive, which is a promising sign for the company’s sales trajectory.

Balance Sheet

The balance sheet of KinderCare Learning Companies Inc reflects a high debt-to-equity ratio, indicating significant leverage that could pose financial risks if not managed properly. The equity ratio is moderate, showing a balanced but slightly weaker equity position compared to total assets. Return on equity has been declining, impacting shareholder value. Overall, the balance sheet highlights a need for better financial management to improve equity and reduce leverage.

Cash Flow

Cash flow analysis reveals a concerning trend of negative free cash flow, primarily due to higher capital expenditures than operating cash flow in recent periods. While operating cash flow remains positive, the ratio to net income indicates inefficiencies. The company needs to focus on improving free cash flow sustainability to support long-term operations and growth.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.99B	2.66B	2.51B	2.17B	1.81B	1.37B
	Gross Profit
418.80M	630.52M	685.86M	741.20M	506.20M	214.49M
	EBIT
13.96M	79.32M	275.29M	389.47M	212.40M	-30.80M
	EBITDA
109.39M	209.91M	391.86M	477.73M	295.36M	18.48M
	Net Income Common Stockholders
-98.47M	-92.84M	102.56M	219.17M	88.41M	-129.50M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
131.29M	62.34M	156.15M	105.21M	177.25M	53.23M
	Total Assets
3.72B	3.65B	3.65B	3.66B	3.47B	3.27B
	Total Debt
1.48B	2.39B	2.69B	1.36B	1.40B	2.85B
	Net Debt
1.35B	2.33B	2.54B	1.26B	1.22B	2.80B
	Total Liabilities
2.83B	2.78B	3.15B	3.26B	3.21B	3.13B
	Stockholders Equity
884.88M	864.51M	506.88M	407.69M	255.61M	136.28M
Cash Flow		Free Cash Flow
41.55M	-16.43M	174.50M	202.18M	116.40M	-34.60M
	Operating Cash Flow
144.28M	115.89M	303.54M	341.61M	183.29M	13.59M
	Investing Cash Flow
-109.83M	-147.24M	-117.66M	-299.73M	-80.15M	-48.48M
	Financing Cash Flow
1.13M	-62.63M	-134.94M	-117.66M	20.87M	47.77M

KinderCare Learning Companies Inc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LRN	82 Outperform	$6.19B	22.17	23.76%	―	14.90%	60.56%
ATGE	80 Outperform	$4.31B	20.22	16.62%	―	13.10%	127.72%
UTI	78 Outperform	$1.80B	32.38	21.81%	―	14.69%	188.00%
PRDO	77 Outperform	$2.11B	14.24	16.54%	1.63%	6.35%	0.35%
STRA	73 Outperform	$2.04B	18.10	6.86%	2.84%	5.72%	11.02%
Sector *	65 Neutral	$8.89B	14.91	4.67%	6.16%	3.60%	-2.89%
KLC	55 Neutral	$1.27B	35.79	-13.54%	―	4.87%	-198.67%

KinderCare Learning Companies Inc Corporate Events

KinderCare Announces Board Changes and Key Decisions

On June 5, 2025, Preston Grasty resigned from the Board of Directors of KinderCare Learning Companies, Inc., with no disagreements cited. The same day, the company held its 2025 Annual Meeting of Stockholders, where key decisions included the election of Christine Deputy and Paul Thompson as Class I directors, the ratification of PricewaterhouseCoopers LLP as the independent registered public accounting firm, and the approval of executive compensation. Additionally, stockholders voted for annual advisory votes on executive compensation.

The most recent analyst rating on (KLC) stock is a Buy with a $31.00 price target. To see the full list of analyst forecasts on KinderCare Learning Companies Inc stock, see the KLC Stock Forecast page.