Nelnet (NNI) AI Stock Analysis

• Market Cap: $4.86B
• Dividend Yield: 0.87%
• Average Volume (3M): 143.54K
• Price to Earnings (P/E): 11.3
• Beta (1Y): 0.67
• Revenue Growth: 9.14%
• EPS Growth: 291.99%
• Country: US
• Employees: 6,739
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 1.56
• Shares Outstanding: 25,258,282
• 10 Day Avg. Volume: 200,933
• 30 Day Avg. Volume: 143,538
• PEG Ratio: 0.09
• Price to Book (P/B): 1.31
• Price to Sales (P/S): 2.13
• P/FCF Ratio: 12.17
• Enterprise Value/Market Cap: 2.07
• Enterprise Value/Revenue: 4.83
• Enterprise Value/Gross Profit: 6.29
• Enterprise Value/Ebitda: 13.90
• 1Y Price Target: $140.00
• Price Target Upside: 2.96% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 8.81
• Revenue Forecast (FY): $1.59B

• Rating: 53 Neutral
• Price Target: $133.00 ▼(-2.19% Downside)
• Action: Downgraded Date: 02/27/26
• Date: Action: Downgraded 02/27/26

The score is held back primarily by weaker and less reliable latest-year financials (sharp revenue decline, negative operating/free cash flow, and data discontinuities). Valuation is a supportive offset with a low P/E, while technical indicators are broadly neutral/soft. The recent acquisition is a modest positive but not enough to outweigh near-term financial uncertainty.

Positive Factors

Diversified, fee-based business mix

Nelnet’s revenue comes from recurring, contract-linked servicing fees, school software subscriptions, payment processing, and lending interest. This mix reduces reliance on any single revenue source, supports predictable cash flows, and enables cross-sell across education customers over a multi-month horizon.

Strategic scale expansion in Canada

The Finastra Canada acquisition materially increases Nelnet’s North American servicing scale and market footprint. Greater scale boosts contract competitiveness, operational leverage in servicing platforms, and positions Nelnet to capture incremental institutional mandates and cross-border servicing opportunities over the medium term.

Historically strong cash generation and improving leverage

Through 2024 Nelnet demonstrated durable free cash flow conversion and reduced leverage from prior peaks, creating a stronger financial foundation. That track record implies management can generate cash and de-lever in normal conditions, supporting investment in tech and acquisitions over coming quarters.

Negative Factors

Sharp 2025 revenue and cash-flow deterioration

A ~59% revenue drop and negative operating/free cash flow in 2025 represent a structural hit to earnings quality and internal funding. Even if partly temporary, such a pronounced decline undermines near-term reinvestment capacity and heightens execution risk across servicing, lending, and tech initiatives for several quarters.

Data and reporting discontinuities reduce visibility

Missing or zeroed income and balance-sheet fields materially weaken the reliability of recent results. This reduces investors’ and counterparties’ ability to assess credit risk, capital needs, and margin sustainability, increasing uncertainty around financing and strategic decisions for the next few quarters.

Legacy debt-heavy profile and bank regulatory complexity

Although leverage fell to ~2.5x by 2024, a history of high debt and the company’s bank operations mean ongoing regulatory reporting and capital constraints. Under stress, funding costs or regulatory capital needs could limit flexibility for M&A, buybacks, or product investments across the business over months to come.

Nelnet Business Overview & Revenue Model

Company Description

Nelnet, Inc. engages in loan servicing, communications, education technology, services, and payment processing businesses worldwide. The Loan Servicing and Systems segment provides loan conversion, application processing, borrower updates, customer service, payment processing, due diligence procedures, funds management reconciliation, and claim processing services. This segment also provides student loan servicing software; business process outsourcing services specialized in contact center management, such as inbound calls, outreach campaigns and sales, and interacting with customers through multi-channels. The Education Technology, Services, and Payment Processing segment offers financial management services; school information system software; website design and cost effective admissions software; FACTS Giving, a donation platform; and customized professional development and coaching services, educational instruction services, and technology products that aid in teacher and student evaluations. It also offers tuition payment plans, and service and technology for student billings, payments, and refunds; solutions for in-person, online, and mobile payment experiences on campus; payment processing services, such as credit card and electronic transfer; faith community engagement, giving management, and learning management services and technologies; and an integrated commerce payment platform, financial management, and tuition payment plan services, as well as a school management platform that provides administrative, information management, financial management, and communication functions for K-12 schools. The Communications segment provides fiber optic service to homes and businesses for internet, television, and telephone services. The Asset Generation and Management segment acquires, manages, and owns loan assets. The Nelnet Bank segment operates internet industrial banks. The company was founded in 1978 and is headquartered in Lincoln, Nebraska.

How the Company Makes Money

Nelnet generates revenue through several key streams. The primary source of income is derived from its student loan servicing operations, where it manages federal and private student loans for various lenders and educational institutions, earning servicing fees. Additionally, Nelnet earns interest income from its own loan portfolio, which includes private student loans. The company also generates revenue from technology services provided to educational institutions, including payment processing solutions and enterprise resource management systems. Partnerships with educational institutions and loan originators enhance its service offerings and expand its market reach. Furthermore, Nelnet's strategic investments in technology and education-related ventures contribute to its earnings by diversifying its revenue base and creating new business opportunities.

Nelnet Financial Statement Overview

Summary

Multi-year profitability and cash generation were solid through 2024 with improving leverage, but 2025 shows major deterioration and uncertainty: revenue fell ~59% YoY, operating/free cash flow turned negative, and multiple financial line items appear discontinuous (e.g., debt and operating profit fields), reducing confidence in recent operating trends.

Income Statement

Profitability has been solid over most of the period, with net margins in the mid-to-high teens/20s in 2020–2022 and a rebound in 2024 versus 2023. However, results look far less stable recently: 2025 revenue fell sharply (down ~59% year over year) and key operating profitability fields are effectively missing/zeroed in the dataset (gross profit and EBIT), which reduces confidence in operating trend quality despite a high reported net margin for 2025.

Balance Sheet

Leverage improved meaningfully through 2024 (debt-to-equity moving down from very high levels in 2020–2022 to ~2.5x in 2024), and equity remains sizable relative to the business. That said, the capital structure has historically been debt-heavy, and 2025 shows total debt at 0 in the dataset (a major discontinuity versus prior years), which makes the latest-year balance sheet hard to rely on and adds risk to the overall assessment.

Cash Flow

Cash generation was strong and generally supportive in 2020–2024, with consistently positive free cash flow and healthy conversion relative to earnings. The main issue is the sharp reversal in 2025, when operating cash flow and free cash flow turned negative and free cash flow declined materially versus the prior year, signaling weaker underlying cash earnings and/or working-capital/portfolio swings.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.26B	1.85B	1.81B	1.82B	1.42B
Gross Profit	1.97B	1.11B	961.15M	1.35B	1.25B
EBITDA	1.06B	361.11M	214.11M	678.09M	634.43M
Net Income	428.47M	184.04M	89.83M	406.90M	393.29M
Balance Sheet
Total Assets	14.06B	13.78B	16.71B	19.37B	21.68B
Cash, Cash Equivalents and Short-Term Investments	2.64B	1.18B	1.11B	1.51B	1.06B
Total Debt	7.80B	8.31B	11.83B	14.64B	17.65B
Total Liabilities	10.49B	10.48B	13.51B	16.17B	18.73B
Stockholders Equity	3.69B	3.35B	3.25B	3.20B	2.95B
Cash Flow
Free Cash Flow	396.75M	641.99M	358.92M	624.64M	421.38M
Operating Cash Flow	422.99M	662.89M	432.98M	684.06M	480.33M
Investing Cash Flow	509.43M	2.41B	1.94B	2.27B	1.19B
Financing Cash Flow	-890.16M	-3.17B	-2.70B	-2.79B	-1.43B

Nelnet Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 135.98
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 135.98 is above the 20-day moving average (MA) of 131.10, above the 50-day MA of 132.71, and above the 200-day MA of 126.48, indicating a bullish trend. The MACD of 0.28 indicates Negative momentum. The RSI at 61.26 is Neutral, neither overbought nor oversold. The STOCH value of 90.50 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NNI.

Nelnet Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BFH	74 Outperform	$3.24B	6.42	16.37%	1.12%	-4.32%	58.34%
ENVA	71 Outperform	$3.54B	12.62	24.34%	―	21.10%	76.12%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
CACC	64 Neutral	$5.17B	11.59	28.14%	―	10.30%	154.64%
SLM	63 Neutral	$3.80B	6.01	32.31%	1.88%	0.59%	-1.11%
NNI	53 Neutral	$4.86B	11.27	12.27%	0.87%	9.14%	291.99%
NAVI	49 Neutral	$817.77M	-16.09	-1.95%	4.95%	-25.22%	-174.34%

Nelnet Corporate Events

Nelnet Expands Canadian Student Loan Servicing Presence

On February 2, 2026, Nelnet, Inc., through its wholly owned subsidiary Nelnet Canada, completed the previously announced acquisition of Finastra Holdings Limited’s Canadian student loan servicing business from DH Corporation for CAD $130.5 million (approximately USD $95 million) in cash, under a definitive purchase agreement originally signed on October 22, 2025. The deal expands Nelnet’s presence in the Canadian student loan servicing market, strengthening its position as a key provider of education finance servicing and potentially increasing its scale and influence in the broader North American student lending ecosystem.

The most recent analyst rating on (NNI) stock is a Buy with a $159.00 price target. To see the full list of analyst forecasts on Nelnet stock, see the NNI Stock Forecast page.

Nelnet Bank Files Quarterly FDIC Call Report Disclosure

On January 29, 2026, Nelnet Bank filed its quarterly Consolidated Reports of Condition and Income (Call Report) for the period ended December 31, 2025 with the Federal Deposit Insurance Corporation, covering its operations as a bank with domestic offices and assets under $5 billion. The filing, which is publicly accessible via the FDIC, fulfills a key regulatory disclosure obligation for Nelnet Bank but is expressly designated as not being deemed filed under, or automatically incorporated into, securities law filings, clarifying its limited legal status for investors and other stakeholders.

The most recent analyst rating on (NNI) stock is a Buy with a $159.00 price target. To see the full list of analyst forecasts on Nelnet stock, see the NNI Stock Forecast page.

Nelnet Announces Retirement of President and NBS CEO

On January 15, 2026, Nelnet announced that its president and Nelnet Business Services CEO, Tim Tewes, will retire effective June 30, 2026, after more than 25 years with the organization and its predecessor, FACTS Management. Tewes, who joined Nelnet in 2005, became NBS CEO in 2007 and president in 2014, and has been credited with driving the company’s growth and diversification through strategic acquisitions, expansion of product offerings, and the successful launch of Nelnet Bank; following his retirement from management, he will remain on the Nelnet Bank board, providing continuity in leadership for the company’s banking operations and education payment businesses.

The most recent analyst rating on (NNI) stock is a Buy with a $159.00 price target. To see the full list of analyst forecasts on Nelnet stock, see the NNI Stock Forecast page.