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Grand Canyon Education
(NASDAQ:LOPE)
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Rating:72Outperform
Price Target:
$167.00
▲(19.34% Upside)
Action:Reiterated
Date:07/31/26
Overall score is driven primarily by strong financial quality (low leverage and solid free cash flow) and a generally positive earnings update with guidance above consensus. The score is tempered by mixed technicals (short-term strength but weaker longer-term trend) and growth risks highlighted in both financials and the call, including revenue pressure from the amended MSA and recent TTM top-line decline.
Positive Factors
Conservative balance sheet & high ROE
A very low debt-to-equity ratio and sustained ROE in the high 20s–low 30s give the company durable financial resilience. This conservatism supports liquidity, capital allocation flexibility (buybacks, CapEx), and the ability to absorb revenue timing shocks without jeopardizing core operations.
Negative Factors
Amended MSA trims recurring service revenue
A structural contract change that narrows the fee base reduces the recurring revenue runway. Even with limited near-term operating income impact, a lower contractual share of tuition creates a permanent drag on top-line scale and requires sustained margin or volume offset to meet past growth profiles.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet & high ROE
A very low debt-to-equity ratio and sustained ROE in the high 20s–low 30s give the company durable financial resilience. This conservatism supports liquidity, capital allocation flexibility (buybacks, CapEx), and the ability to absorb revenue timing shocks without jeopardizing core operations.
Read all positive factors
Grand Canyon Education (LOPE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.79B
Dividend YieldN/A
Average Volume (3M)386.75K
Price to Earnings (P/E)17.5
Beta (1Y)0.82
Revenue Growth6.97%
EPS Growth0.18%
CountryUS
Employees2,700
SectorConsumer Defensive
Sector Strength42
IndustryEducation & Training Services
Share Statistics
EPS (TTM)8.32
Shares Outstanding26,065,037
10 Day Avg. Volume386,238
30 Day Avg. Volume386,753
Financial Highlights & Ratios
PEG Ratio-166.52
Price to Book (P/B)6.20
Price to Sales (P/S)4.19
P/FCF Ratio19.42
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$192.50Price Target Upside37.56% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
EPS Forecast (FY)10.07
Revenue Forecast (FY)$1.17B
Grand Canyon Education Business Overview & Revenue Model
Company Description
Grand Canyon Education, Inc. (GCE) furnishes a broad spectrum of educational support services to higher education institutions throughout the United States. Its comprehensive suite of offerings encompasses technology solutions, such as learning ma...
How the Company Makes Money
Grand Canyon Education primarily makes money by providing a contracted bundle of education services to partner universities, with GCU historically being the significant counterpart. Under this model, the company earns revenue via service fees tied...
Grand Canyon Education Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 22, 2026
Earnings Call Sentiment Positive
The call highlighted solid top‑line growth, improved margins, a meaningful EPS beat, and multiple strategic expansion initiatives (honors college, construction programs, planned law school, and hybrid scale opportunity). These positives are partly offset by an amended long‑term MSA that reduces service revenue by an estimated ~$20 million annually, timing shifts that depress near‑term revenue in Q3/Q4, program mix pressure on revenue per student, and some margin headwinds from rising costs and hybrid capacity constraints. Management expects the MSA to have only a small impact on operating income and reiterated buybacks, liquidity, and continued margin expansion for 2026, resulting in a constructive but cautious outlook.Positive Updates
Service Revenue Growth
Service revenue of $264.0 million in Q2 2026, up $16.5 million or 6.7% year-over-year (Q2 2025: $247.5M). Growth driven by partner enrollments and stronger hybrid/traditional summer enrollments.
Negative Updates
Amended Master Services Agreement Reduces Revenue
Amended and restated MSA with GCU effective July 1, 2026 restructures fees (service fees = 60% of tuition & academic fees; ancillary fees retained by GCU) and is estimated to reduce service revenue by approximately $20 million annually.
Read all updates
Q2-2026 Updates
Positive
Negative
Service Revenue Growth
Service revenue of $264.0 million in Q2 2026, up $16.5 million or 6.7% year-over-year (Q2 2025: $247.5M). Growth driven by partner enrollments and stronger hybrid/traditional summer enrollments.
Read all positive updates
Company Guidance
GCE updated full‑year 2026 guidance calling for adjusted EPS to be roughly $0.14 above consensus for the year and $0.03 above consensus in the second half (Q2 non‑GAAP EPS $1.81; GAAP $1.75), and reported Q2 service revenue of $264.0M (up $16.5M or 6.7% YoY), operating income $58.2M (22% margin), and net income $45.9M. The company said the amended MSA will reduce service revenue by about $20M annually (with operating income impact immaterial and not to exceed ~$1M/quarter), and it now expects revenue headwinds of $4M in Q3 and $6M in Q4, with instructional costs/services reduced by $3M and $5M in Q3 and Q4 respectively; $1M of revenue was accelerated into Q2 and semester timing moves $8.3M from Q3 to Q4. Key modeling assumptions include new online starts up mid‑to‑high single digits in H2, hybrid growth in the teens (currently ~6,000 hybrid students across 47 sites at ~60% capacity toward a target of 80 sites and ~600 students/site → ~50K capacity), fall ground enrollment ~25,000, 2026 CapEx $30–35M (Q2 CapEx $10.7M, 4.1% of service revenue), cash & investments $274.5M, share repurchases of 471K shares ($75.3M) in Q2 plus 169K since June 30 with $124.1M remaining authorization, a planned line of credit by mid‑August, declining interest income, and an effective tax rate of 23.2% for the year (Q3 20.8%, Q4 23.2%) after a $5M contribution in lieu of state taxes.Grand Canyon Education Financial Statement Overview
Summary
Income Statement
71
Positive
Balance Sheet
86
Very Positive
Cash Flow
79
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.14B | 1.11B | 1.03B | 960.90M | 911.31M | 896.56M |
| Gross Profit | 608.39M | 588.36M | 544.43M | 503.71M | 487.50M | 515.31M |
| EBITDA | 328.71M | 319.75M | 327.87M | 291.68M | 271.30M | 365.30M |
| Net Income | 224.21M | 216.17M | 226.23M | 204.99M | 184.68M | 260.34M |
Balance Sheet | ||||||
| Total Assets | 919.18M | 992.30M | 1.02B | 930.46M | 832.75M | 1.22B |
| Cash, Cash Equivalents and Short-Term Investments | 274.53M | 300.08M | 324.62M | 244.51M | 181.70M | 600.94M |
| Total Debt | 104.21M | 200.08M | 108.52M | 99.28M | 77.44M | 61.18M |
| Total Liabilities | 249.67M | 245.37M | 234.57M | 212.45M | 195.13M | 177.70M |
| Stockholders Equity | 669.51M | 746.93M | 783.85M | 718.01M | 637.62M | 1.05B |
Cash Flow | ||||||
| Free Cash Flow | 242.49M | 238.59M | 252.71M | 198.23M | 185.19M | 283.73M |
| Operating Cash Flow | 278.71M | 273.49M | 289.96M | 243.66M | 220.82M | 313.12M |
| Investing Cash Flow | 42.78M | -221.59M | 61.37M | -80.47M | -97.14M | 950.98M |
| Financing Cash Flow | -342.71M | -264.76M | -173.18M | -137.12M | -604.21M | -908.93M |
Grand Canyon Education Technical Analysis
Negative
139.94
Price Trends
147.27
Positive
156.75
Negative
163.62
Negative
Market Momentum
0.69
Negative
51.39
Neutral
54.38
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOPE, the sentiment is Negative. The current price of 139.94 is below the 20-day moving average (MA) of 146.18, below the 50-day MA of 147.27, and below the 200-day MA of 163.62, indicating a neutral trend. The MACD of 0.69 indicates Negative momentum. The RSI at 51.39 is Neutral, neither overbought nor oversold. The STOCH value of 54.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LOPE.
Grand Canyon Education Risk Analysis
Grand Canyon Education disclosed 39 risk factors in its most recent earnings report. Grand Canyon Education reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Grand Canyon Education Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $5.18B | 9.60 | 11.56% | 0.64% | 4.83% | -20.20% | |
74 Outperform | $5.28B | 30.90 | 28.61% | ― | 17.89% | 31.70% | |
72 Outperform | $3.79B | 17.47 | 31.24% | ― | 6.97% | 0.18% | |
71 Outperform | $3.41B | 11.20 | 21.31% | ― | 10.93% | 2.97% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
53 Neutral | $2.10B | 63.50 | 5.48% | ― | 0.07% | ― |
* Consumer Defensive Sector Average
LOPE
Grand Canyon Education
152.53
-45.70
-23.05%
LRN
Stride
82.51
-66.94
-44.79%
GHC
Graham Holdings
1,185.71
218.90
22.64%
LAUR
Laureate Education
38.34
13.31
53.18%
MH
McGraw Hill, Inc.
11.60
-1.71
-12.85%
Grand Canyon Education Corporate Events
Executive/Board ChangesShareholder Meetings
Grand Canyon Education Shareholders Back Leadership and Governance
Positive
Jun 10, 2026
On June 10, 2026, Grand Canyon Education, Inc. held its 2026 Annual Meeting of Stockholders, with approximately 91% of eligible shares represented, and shareholders elected all six director nominees to serve until the 2027 annual meeting. Investor...
Business Operations and StrategyFinancial Disclosures
Grand Canyon Education Considers Amendments to GCU Services Agreement
Neutral
Jun 3, 2026
Grand Canyon Education and its primary partner Grand Canyon University, which have operated under a 15-year Master Services Agreement since July 1, 2018, are exploring amendments that would reset or extend the term beyond June 30, 2033 and narrow ...
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.