SLM (SLM) AI Stock Analysis

• Market Cap: $7.09B
• Dividend Yield: 1.54%
• Average Volume (3M): 1.95M
• Price to Earnings (P/E): 12.2
• Beta (1Y): 1.06
• Revenue Growth: -0.70%
• EPS Growth: -12.72%
• Country: US
• Employees: 1,710
• Sector: Financial
• Sector Strength: 82
• Industry: Financial - Credit Services
• EPS (TTM): 1.40
• Shares Outstanding: 209,856,500
• 10 Day Avg. Volume: 2,342,706
• 30 Day Avg. Volume: 1,951,105
• PEG Ratio: 0.32
• Price to Book (P/B): 1.15
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -243.41
• Enterprise Value/Market Cap: 0.41
• Enterprise Value/Revenue: 0.29
• Enterprise Value/Gross Profit: 1.85
• Enterprise Value/Ebitda: 0.70
• 1Y Price Target: $34.57
• Price Target Upside: 2.07% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 66 Neutral
• Price Target: ―

SLM's overall score reflects strong profitability and strategic corporate actions, tempered by liquidity concerns and technical caution. The stock is fairly valued, with growth potential supported by recent corporate events and earnings call insights.

Positive Factors

Financial Strength

SLM is growing its balance sheet while still buying back stock, indicating financial strength.

Market Opportunities

No changes to undergraduate borrowing limits benefits private market potential for SLM Corporation.

Negative Factors

Credit Performance

Delinquency rates continue to increase year-over-year, indicating potential future challenges in credit performance.

Lending Market Impact

The elimination of Grad PLUS loans could reduce the federal lending market, impacting SLM's market.

SLM Business Overview & Revenue Model

Company Description

SLM Corporation, commonly known as Sallie Mae, is a publicly traded company that primarily operates in the financial services sector. It specializes in providing education loans, focusing on private student loans for undergraduate, graduate, and professional education. Sallie Mae also offers various financial products, including savings accounts, CDs, and credit cards, aiming to support students and their families in financing higher education.

How the Company Makes Money

SLM Corporation makes money primarily through the origination and servicing of private student loans, which are not funded or guaranteed by the federal government. The company earns revenue from the interest on these loans, as well as fees associated with loan origination and servicing. Additionally, Sallie Mae generates income from its consumer banking operations, including interest and fees from deposits, CDs, and credit card products. The company's earnings are influenced by interest rate environments, demand for private student loans, and its ability to manage credit risk effectively.

SLM Financial Statement Overview

Summary

SLM demonstrates strong profitability with solid profit margins and an improved leverage position. However, declining revenue growth and negative cash flow metrics present concerns about sustainability and liquidity.

Income Statement

The company exhibits strong profitability with a solid gross profit margin of 76.1% and a net profit margin of 39.4% in the TTM period. However, the revenue growth rate showed a decline of 40.0% from the previous year, which is concerning. EBIT and EBITDA margins are robust at 27.1% and 20.5%, respectively, indicating efficient operational performance.

Balance Sheet

The balance sheet reflects a strong equity ratio of 8.3%, suggesting a decent level of financial stability. However, the debt-to-equity ratio has improved to 0.0 in the TTM period due to zero debt, indicating reduced financial leverage. Return on equity remains impressive at 25.8%, showcasing effective use of shareholder funds.

Cash Flow

The cash flow analysis indicates challenges with negative free cash flow in the TTM period, suggesting potential liquidity issues. The operating cash flow to net income ratio is negative, highlighting inefficiencies in converting profits to cash. The free cash flow to net income ratio is also negative, reflecting cash management concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.72B	1.44B	1.46B	1.19B	2.41B	1.72B
Gross Profit	1.56B	2.27B	890.43M	1.50B	2.06B	1.58B
EBITDA	968.00M	816.29M	796.11M	648.06M	1.56B	1.25B
Net Income	622.93M	608.33M	581.39M	469.01M	1.16B	880.69M
Balance Sheet
Total Assets	28.90B	30.07B	29.17B	28.81B	29.22B	30.77B
Cash, Cash Equivalents and Short-Term Investments	3.70B	4.70B	4.15B	4.67B	6.85B	6.45B
Total Debt	6.15B	6.44B	5.23B	5.24B	5.93B	5.19B
Total Liabilities	26.50B	27.91B	27.29B	27.08B	5.93B	5.19B
Stockholders Equity	2.40B	2.16B	1.88B	1.73B	2.15B	2.56B
Cash Flow
Free Cash Flow	-399.94M	-329.39M	-144.64M	4.99M	-49.52M	2.15B
Operating Cash Flow	-399.94M	-322.41M	-144.64M	4.99M	-49.52M	-182.67M
Investing Cash Flow	600.59M	675.99M	-12.46M	1.08B	2.60B	947.33M
Financing Cash Flow	-65.12M	228.16M	-316.23M	-854.89M	-2.62B	-1.88B

SLM Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 33.87
• 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 SLM, the sentiment is Positive. The current price of 33.87 is above the 20-day moving average (MA) of 32.12, above the 50-day MA of 31.74, and above the 200-day MA of 27.62, indicating a bullish trend. The MACD of 0.39 indicates Negative momentum. The RSI at 66.29 is Neutral, neither overbought nor oversold. The STOCH value of 85.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SLM.

SLM Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CACC	76 Outperform	$6.31B	23.21	17.24%	―	13.77%	20.95%
NNI	73 Outperform	$4.45B	23.56	5.64%	0.92%	-2.56%	43.22%
ALLY	68 Neutral	$12.56B	30.06	3.84%	2.93%	-2.99%	-43.64%
OMF	68 Neutral	$7.11B	12.65	17.46%	7.02%	9.07%	―
Sector *	67 Neutral	$17.01B	11.90	9.70%	3.76%	11.63%	-9.47%
SLM	66 Neutral	$7.09B	12.17	27.60%	1.54%	-0.70%	-12.72%
LC	62 Neutral	$1.42B	28.00	3.86%	―	5.72%	31.82%

SLM Corporate Events

SLM Stockholders Approve Key Proposals at Annual Meeting

At the 2025 Annual Meeting of Stockholders held on June 17, 2025, SLM Corporation’s stockholders approved several key proposals, including the 2025 Employee Stock Purchase Plan (ESPP). The plan had previously been approved by the Board of Directors, contingent on stockholder approval. Additionally, the stockholders elected 13 directors for a one-year term, approved executive compensation, and ratified the appointment of KPMG LLP as the independent public accounting firm for 2025. These decisions are likely to impact the company’s governance and financial strategies moving forward.

The most recent analyst rating on (SLM) stock is a Hold with a $25.00 price target. To see the full list of analyst forecasts on SLM stock, see the SLM Stock Forecast page.

SLM Corporation Reports Strong Q1 2025 Financial Results

In the first quarter of 2025, SLM Corporation reported a GAAP net income of $301 million and a diluted earnings per share of $1.40. The company experienced a 7.3% growth in private education loan originations compared to the previous year, reaching $2.8 billion. SLM also achieved a 60% return on common equity and paid a common stock dividend of $0.13 per share. Despite a decrease in net interest margin and deposit portfolio balances, the company maintained strong financial metrics, including a 12.9% total risk-based capital ratio. The sale of $2.0 billion in private education loans contributed to a $188 million gain, highlighting the company’s effective capital allocation strategy.

SLM Appoints New Directors to Strengthen Board

On April 23, 2025, SLM Corporation appointed Dr. Daniel Greenstein and Mr. Gary Millerchip as new directors, expanding the Board from twelve to fourteen members. Dr. Greenstein brings extensive experience in higher education strategy and innovation, while Mr. Millerchip offers a strong background in finance and corporate strategy. Their appointments are expected to enhance the Board’s expertise and support the company’s strategic priorities. Additionally, Robert S. Strong announced his retirement from the Board effective June 17, 2025, leading to a subsequent reduction in Board size to thirteen members.

SLM Releases Presentation on Student Loan Portfolio

On April 24, 2025, SLM Corporation released a presentation on its website detailing the historical performance of its Smart Option Student Loan portfolio as of March 31, 2025. The company has been actively involved in securitization and sales of its private education loans, with significant transactions occurring annually from 2020 to 2025. In the first quarter of 2025, Sallie Mae sold approximately $2.0 billion of private education loans to an unaffiliated third party, reflecting its ongoing strategy to manage its loan portfolio and maintain liquidity.