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Legacy Education Inc.
(NYSE MKT:LGCY)
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Rating:66Neutral
Price Target:
$13.00
▲(10.83% Upside)
Action:Downgraded
Date:06/05/26
The score is driven primarily by solid underlying financial performance and a constructive earnings outlook (profitable growth, strong liquidity, expansion plans). Offsetting that are weaker recent cash-flow conversion signals and a soft technical setup (below key moving averages with negative MACD), with valuation appearing reasonable but not strongly supportive without a dividend.
Positive Factors
High and sustainable profitability
Consistent mid‑40% gross and ~11% net margins with mid‑teens EBIT provide durable profitability and pricing power in program delivery. These margins create a cushion to fund investments, absorb enrollment volatility, and support persistently strong returns on equity.
Negative Factors
Weak cash‑flow conversion
Operating cash flow has lagged reported earnings (coverage below 0.5) and TTM free cash flow growth is negative, indicating weaker cash conversion. This raises the risk that growth investments and working capital swings will pressure liquidity or require more financing if trends persist.
Read all positive and negative factors
Positive Factors
Negative Factors
High and sustainable profitability
Consistent mid‑40% gross and ~11% net margins with mid‑teens EBIT provide durable profitability and pricing power in program delivery. These margins create a cushion to fund investments, absorb enrollment volatility, and support persistently strong returns on equity.
Read all positive factors
Legacy Education Inc. Key Performance Indicators (KPIs)
Legacy Education Inc. (LGCY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$133.61M
Dividend YieldN/A
Average Volume (3M)42.39K
Price to Earnings (P/E)15.5
Beta (1Y)0.88
Revenue Growth32.11%
EPS Growth13.02%
CountryUS
Employees427
SectorGeneral
Sector StrengthN/A
IndustryEducation & Training Services
Share Statistics
EPS (TTM)0.68
Shares Outstanding12,652,038
10 Day Avg. Volume47,095
30 Day Avg. Volume42,386
Financial Highlights & Ratios
PEG Ratio0.34
Price to Book (P/B)3.15
Price to Sales (P/S)2.02
P/FCF Ratio18.70
Enterprise Value/Market Cap1.01
Enterprise Value/Revenue1.74
Enterprise Value/Gross Profit3.68
Enterprise Value/Ebitda10.40
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.8
Revenue Forecast (FY)$91.58M
Legacy Education Inc. Business Overview & Revenue Model
Company Description
Legacy Education Inc. provides education services to students, high school graduates, and working parents in the United States. The company offers degree programs, including Ultrasound Technician, Cardiac Sonography, and Vocational Nursing Associa...
How the Company Makes Money
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Legacy Education Inc. Earnings Call Summary
Earnings Call Date:May 14, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Oct 12, 2026
Earnings Call Sentiment Positive
The call presents a broadly positive operational and financial story: strong revenue growth (15% Q3, ~30% YTD), improving operating leverage (270 bps improvement in educational services), expanding student starts and healthy adjusted EBITDA growth, supported by strong liquidity and accreditations. Offsetting factors include higher G&A and upfront investments, state approval delays that temporarily limited enrollments, a slight increase in AR reserves, and execution/timing risks related to regulatory approvals and branch rollouts. Overall, the company is growing profitably and investing to scale, with manageable near-term headwinds tied to timing and investment cadence.Positive Updates
Q3 Revenue Growth
Revenue increased 15% year-over-year to $21.4M in Q3 (from $18.6M), driven by expanded program offerings, improved retention and stronger execution across campuses; sequential revenue also rose from $19.2M in Q2 to $21.4M in Q3.
Negative Updates
Rising General & Administrative Expense Ratio
Q3 general & administrative expense rose to $6.2M or 28.8% of revenue versus $4.6M or 24.9% a year ago (increase of ~390 basis points as a percent of revenue), driven by marketing investments, professional fees, bad debt and growth-related infrastructure spend.
Read all updates
Q3-2026 Updates
Positive
Negative
Q3 Revenue Growth
Revenue increased 15% year-over-year to $21.4M in Q3 (from $18.6M), driven by expanded program offerings, improved retention and stronger execution across campuses; sequential revenue also rose from $19.2M in Q2 to $21.4M in Q3.
Read all positive updates
Company Guidance
Management guided to continued profitable, disciplined scaling rather than sacrificing margin, citing Q3 revenue of $21.4M (+15% YoY; up from $19.2M in Q2), adjusted EBITDA $4.4M (20.6% margin, +12.6% YoY), EBITDA $4.1M, net income $3.0M (+7.5%), diluted EPS $0.22 (+4.8%), and 9‑month revenue of $60.0M (+29.7%); they expect further organic program ramps (surgical tech ~26 enrollments, sterile processing ~49 enrollments, MRI and cardiac sonography planned for Q4) and branch expansion (LOI for ~25,000 sq ft outside California) with phased facility adds (Lancaster +6,000 sq ft to ~32,000; Temecula staged to 53,000 sq ft: 5,000 now, 31,000 in June, 17,000 Jan 2028) to support material incremental capacity (management cited potential to expand Lancaster/Temecula toward ~1,000–1,500 more students and ~600–800 at the new branch over 12–24 months), all funded from a strong balance sheet (cash $21.7M, working capital $30.9M, debt $0.6M, stockholders’ equity $49.5M, operating cash flow $2.9M) while delivering improved operating leverage (educational services expense 51.7% of revenue, a 270 bps improvement YoY) and retention-driven student population growth to 3,550 students (+9.4%).Legacy Education Inc. Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
74
Positive
Cash Flow
60
Neutral
| Breakdown | TTM | Jun 2025 | Sep 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 77.90M | 64.17M | 46.00M | 35.46M | 30.70M | 57.81M |
| Gross Profit | 36.80M | 29.92M | 19.65M | 14.67M | 12.59M | 30.06M |
| EBITDA | 13.01M | 11.58M | 7.37M | 4.19M | 3.67M | 12.46M |
| Net Income | 8.49M | 7.53M | 5.11M | 2.67M | 2.34M | 9.61M |
Balance Sheet | ||||||
| Total Assets | 75.46M | 69.21M | 35.17M | 27.25M | 20.61M | 17.95M |
| Cash, Cash Equivalents and Short-Term Investments | 21.68M | 20.32M | 10.38M | 9.29M | 8.77M | 7.85M |
| Total Debt | 15.52M | 17.68M | 4.84M | 5.56M | 953.24K | 1.10M |
| Total Liabilities | 25.94M | 28.16M | 12.75M | 11.82M | 7.01M | 6.95M |
| Stockholders Equity | 49.52M | 41.04M | 22.42M | 15.42M | 13.60M | 11.00M |
Cash Flow | ||||||
| Free Cash Flow | 4.75M | 6.92M | 1.23M | 1.57M | 793.73K | 4.64M |
| Operating Cash Flow | 5.88M | 7.77M | 1.65M | 1.77M | 1.09M | 4.84M |
| Investing Cash Flow | -1.13M | -6.98M | -423.71K | -195.08K | -294.87K | -199.59K |
| Financing Cash Flow | -395.15K | 9.15M | -238.55K | -1.05M | 129.03K | 1.79M |
Legacy Education Inc. Technical Analysis
Negative
11.73
Price Trends
11.46
Negative
11.70
Negative
11.30
Negative
Market Momentum
-0.34
Positive
36.26
Neutral
26.83
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LGCY, the sentiment is Negative. The current price of 11.73 is above the 20-day moving average (MA) of 11.35, above the 50-day MA of 11.46, and above the 200-day MA of 11.30, indicating a bearish trend. The MACD of -0.34 indicates Positive momentum. The RSI at 36.26 is Neutral, neither overbought nor oversold. The STOCH value of 26.83 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LGCY.
Legacy Education Inc. Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $41.79M | 0.73 | 40.13% | ― | 2.50% | 23.59% | |
71 Outperform | $64.91M | 1.17 | 7.52% | 3.93% | -11.84% | -26.71% | |
68 Neutral | $58.60M | 17.13 | 36.37% | ― | 13.83% | 7.79% | |
66 Neutral | $133.61M | 15.49 | 18.83% | ― | 32.11% | 13.02% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
50 Neutral | $70.66M | -0.49 | 1023.93% | ― | -8.42% | -3.59% | |
37 Underperform | $30.69M | -0.47 | -25.09% | ― | 6.00% | 45.53% |
* General Sector Average
LGCY
Legacy Education Inc.
10.52
-1.90
-15.30%
STG
Sunlands Online Education Group
2.94
-7.17
-70.91%
SKIL
Skillsoft
8.15
-7.12
-46.63%
IH
iHuman
1.24
-1.43
-53.49%
GNS
Genius Group Limited
0.17
-0.84
-83.17%
LFS
LEIFRAS Co., Ltd. Sponsored ADR
2.32
-1.88
-44.76%
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.