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Nelnet Inc (NNI)
NYSE:NNI

Nelnet (NNI) AI Stock Analysis

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Nelnet

(NYSE:NNI)

Rating:73Outperform
Price Target:
$132.00
▲(9.63%Upside)
Nelnet's strong financial performance and technical indicators indicate potential growth, boosted by recent corporate gains. However, high leverage and valuation concerns limit upside potential.
Positive Factors
Earnings
Better net interest income (NII) and lower expenses boost analyst's estimates.
Growth Opportunities
Nelnet significantly increased its loan acquisitions, creating new opportunities for growth.
Investment Opportunities
The recent financing transaction involving ALLO generated significant cash for Nelnet, providing further investment opportunities.
Negative Factors
Tariff Impact
Tariff-related uncertainty has weighed on the solar segment, leading to delayed projects and reduced revenue.

Nelnet (NNI) vs. SPDR S&P 500 ETF (SPY)

Nelnet Business Overview & Revenue Model

Company DescriptionNelnet, Inc. is a diverse company operating in the education, finance, and technology sectors. Originally established as a provider of student loan services, Nelnet has expanded its operations to include a wide range of products and services such as loan servicing, payment processing, and asset management. The company is also involved in telecommunications, renewable energy, and real estate. With a commitment to innovation and customer service, Nelnet aims to provide comprehensive solutions to educational financing and related fields.
How the Company Makes MoneyNelnet generates revenue through several key streams. The primary source is its servicing of student loans, where the company earns fees for managing and collecting payments on behalf of the federal government and private lenders. Additionally, Nelnet's payment processing services for educational institutions and other clients contribute significantly to its earnings. The company also invests in and manages a portfolio of renewable energy projects, generating income through tax credits and energy sales. Furthermore, Nelnet's telecommunications division provides broadband services, adding another layer of revenue. Partnerships with educational institutions and government agencies play a crucial role in sustaining and growing these revenue streams.

Nelnet Financial Statement Overview

Summary
Nelnet demonstrates strong profitability with solid operational margins and effective cash flow management. However, the decline in revenue and high leverage are potential areas of concern.
Income Statement
78
Positive
Nelnet's income statement shows strong profitability with a gross profit margin of approximately 62.7% and a net profit margin of 10.8% in TTM. The company has displayed a solid EBIT margin of 14.4% and an impressive EBITDA margin of 35.4%, indicating robust operational efficiency. However, the revenue has slightly declined by 2.7% from the previous year, which may pose a risk if this trend continues.
Balance Sheet
65
Positive
The balance sheet reflects a high debt-to-equity ratio of 2.53, indicating significant leverage which could increase financial risk, particularly in volatile market conditions. The equity ratio stands at 24.1%, suggesting a moderate level of financial stability. Return on equity is strong at 5.7%, showcasing effective use of equity to generate profits.
Cash Flow
72
Positive
Free cash flow increased significantly by 51.1% in TTM, demonstrating effective cash flow management. The operating cash flow to net income ratio is 0.31, and the free cash flow to net income ratio is 0.50, indicating healthy cash generation relative to net income. However, the lower operating cash flow compared to prior periods may need monitoring.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.80B1.85B1.81B1.82B1.42B1.04B
Gross Profit1.13B1.11B961.15M1.51B1.25B1.11B
EBITDA635.96M361.11M214.11M1.01B775.12M923.98M
Net Income193.20M184.04M89.83M407.35M393.29M352.44M
Balance Sheet
Total Assets14.19B13.78B16.74B19.37B21.68B22.65B
Cash, Cash Equivalents and Short-Term Investments67.11M1.18B1.03B2.14B2.64B1.46B
Total Debt8.66B8.31B11.62B14.64B17.63B19.32B
Total Liabilities10.83B10.48B13.51B16.17B18.73B20.02B
Stockholders Equity3.42B3.35B3.26B3.20B2.95B2.63B
Cash Flow
Free Cash Flow97.01M641.99M358.92M624.64M485.92M99.50M
Operating Cash Flow59.79M662.89M432.98M684.06M544.87M212.81M
Investing Cash Flow1.48B2.41B1.94B2.27B1.19B621.22M
Financing Cash Flow-2.13B-3.17B-2.70B-2.79B-1.43B-1.23B

Nelnet Technical Analysis

Technical Analysis Sentiment
Positive
Last Price120.40
Price Trends
50DMA
112.68
Positive
100DMA
112.23
Positive
200DMA
110.92
Positive
Market Momentum
MACD
1.54
Negative
RSI
66.11
Neutral
STOCH
93.41
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NNI, the sentiment is Positive. The current price of 120.4 is above the 20-day moving average (MA) of 115.64, above the 50-day MA of 112.68, and above the 200-day MA of 110.92, indicating a bullish trend. The MACD of 1.54 indicates Negative momentum. The RSI at 66.11 is Neutral, neither overbought nor oversold. The STOCH value of 93.41 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NNI.

Nelnet Risk Analysis

Nelnet disclosed 26 risk factors in its most recent earnings report. Nelnet 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

Nelnet Peers Comparison

Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$2.82B13.0819.94%24.47%54.18%
NNNNI
73
Outperform
$4.38B23.175.64%0.93%-2.56%43.22%
OMOMF
68
Neutral
$6.74B11.9917.46%7.34%9.07%
SLSLM
66
Neutral
$6.92B11.8727.60%1.58%-0.70%-12.72%
66
Neutral
$6.04B-10.30%34.69%63.65%
WUWU
66
Neutral
$2.77B3.11136.84%11.23%-5.16%59.60%
58
Neutral
$12.55B5.32-2.71%5.27%5.88%-56.03%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
NNI
Nelnet
120.40
20.59
20.63%
SLM
SLM
32.96
12.63
62.12%
WU
Western Union
8.37
-2.72
-24.53%
OMF
OneMain Holdings
56.65
12.14
27.27%
ENVA
Enova International
111.01
48.96
78.90%
UPST
Upstart Holdings
63.43
40.53
176.99%

Nelnet Corporate Events

M&A TransactionsFinancial Disclosures
Nelnet Gains $175M from ALLO Holdings Redemption
Positive
Jun 4, 2025

On June 4, 2025, Nelnet, Inc., a company involved in financial services, received $411 million from redeeming certain membership interests in ALLO Holdings LLC. This transaction resulted in a pre-tax gain of $175 million for Nelnet. Following the redemption, Nelnet’s ownership in ALLO decreased from 45% to 27%, and the company no longer holds any preferred membership interests in ALLO.

The most recent analyst rating on (NNI) stock is a Hold with a $115.00 price target. To see the full list of analyst forecasts on Nelnet stock, see the NNI Stock Forecast page.

Shareholder MeetingsBusiness Operations and Strategy
Nelnet Holds 2025 Annual Shareholder Meeting
Neutral
May 20, 2025

Nelnet, Inc. held its 2025 annual meeting of shareholders on May 15, 2025, where several key proposals were voted on. Shareholders elected three Class II directors, ratified KPMG LLP as the independent public accounting firm for 2025, and approved executive compensation. These decisions reflect the company’s ongoing governance and operational strategies, potentially impacting its market positioning and stakeholder relations.

The most recent analyst rating on (NNI) stock is a Hold with a $106.00 price target. To see the full list of analyst forecasts on Nelnet stock, see the NNI Stock Forecast page.

Financial DisclosuresRegulatory Filings and Compliance
Nelnet Bank Files Q1 2025 Call Report
Neutral
Apr 30, 2025

On April 29, 2025, Nelnet Bank filed its Consolidated Reports of Condition and Income for the quarter ended March 31, 2025, with the FDIC. This filing, known as the Call Report, is publicly accessible on the FDIC’s website and reflects Nelnet Bank’s financial condition and income for the specified period.

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.Date of analysis: Jun 25, 2025