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Educational Development
(NASDAQ:EDUC)
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Rating:66Neutral
Price Target:
$1.50
▲(4.17% Upside)
Action:Reiterated
Date:07/10/26
The score is held back mainly by weak operating trajectory and cash conversion (declining revenues, low OCF-to-net-income, and recent losses highlighted on the earnings call), despite a notably improved balance sheet. Technicals are supportive with the stock trading above major moving averages and positive MACD. Valuation is attractive on a low P/E, but execution risk remains high given partner/revenue declines and margin pressure.
Positive Factors
Stronger balance sheet / low leverage
A materially stronger capital structure and near-elimination of bank debt meaningfully increases financial flexibility. Low leverage reduces refinancing and solvency risk during a multi-quarter turnaround, supports conservative purchasing and targeted product/tech investments, and lengthens runway for execution.
Negative Factors
Persistent revenue decline
A sustained top-line contraction indicates weakening end-market demand and fewer active brand partners, reducing the addressable sales base. Multi-quarter declines constrain operating leverage, limit gross profit growth even if margins improve, and make it harder to rebuild scale without durable partner retention gains.
Read all positive and negative factors
Positive Factors
Negative Factors
Stronger balance sheet / low leverage
A materially stronger capital structure and near-elimination of bank debt meaningfully increases financial flexibility. Low leverage reduces refinancing and solvency risk during a multi-quarter turnaround, supports conservative purchasing and targeted product/tech investments, and lengthens runway for execution.
Read all positive factors
Educational Development Key Performance Indicators (KPIs)
Any
Net Revenue By Segment
Breaks down total revenue by business segment, indicating which parts of the company are driving sales and where there might be potential for growth or need for strategic shifts.
Breaks down total revenue by business segment, indicating which parts of the company are driving sales and where there might be potential for growth or need for strategic shifts.
Data provided by:
The Fly
The FlyEducational Development (EDUC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$13.45M
Dividend YieldN/A
Average Volume (3M)32.92K
Price to Earnings (P/E)4.5
Beta (1Y)0.23
Revenue Growth-32.98%
EPS GrowthN/A
CountryUS
Employees64
SectorCommunication Services
Sector Strength97
IndustryPublishing
Share Statistics
EPS (TTM)0.35
Shares Outstanding8,511,364
10 Day Avg. Volume25,652
30 Day Avg. Volume32,925
Financial Highlights & Ratios
PEG Ratio-0.02
Price to Book (P/B)0.27
Price to Sales (P/S)0.53
P/FCF Ratio7.91
Enterprise Value/Market Cap1.32
Enterprise Value/Revenue0.92
Enterprise Value/Gross Profit1.44
Enterprise Value/Ebitda2.00
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Educational Development Business Overview & Revenue Model
Company Description
Educational Development Corporation distributes children's books, educational toys and games, and related products in the United States. It operates through two segments, PaperPie and Publishing. The company owns and publishes Kane Miller books, L...
How the Company Makes Money
null...
Educational Development Earnings Call Summary
Earnings Call Date:Jul 09, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Oct 08, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: meaningful operational actions and early signs of traction (recruiting success, new titles, technology launches, $1.2M+ planned expense savings, and a $0.5M cash increase driven by inventory reduction) are balanced against material year‑over‑year declines in revenue (≈-32%), a substantially lower brand partner base compared with a year ago (≈-31%), ongoing net losses and EPS pressure, gross margin headwinds from promotions, and a large inventory position. Management emphasizes a multi‑quarter turnaround plan and early progress, but substantial work remains before profitability and consistent revenue growth are restored.Positive Updates
Recruiting Momentum — Brand Partner Growth from Promotions
The March recruiting special added over 1,300 new brand partners, bringing active brand partner levels above 5,200 and producing an average of 5,300 active brand partners for the quarter. Management noted a ~20% increase in brand partners since the end of last year and early signs of renewed field enthusiasm following new title releases and convention activity.
Negative Updates
Material Revenue Decline Year‑Over‑Year
Net revenues for fiscal Q1 were $4.8 million versus $7.1 million in the prior-year quarter, a decline of $2.3 million (≈-32.4%), driving the quarter's weaker top-line performance.
Read all updates
Q1-2027 Updates
Positive
Negative
Recruiting Momentum — Brand Partner Growth from Promotions
The March recruiting special added over 1,300 new brand partners, bringing active brand partner levels above 5,200 and producing an average of 5,300 active brand partners for the quarter. Management noted a ~20% increase in brand partners since the end of last year and early signs of renewed field enthusiasm following new title releases and convention activity.
Read all positive updates
Company Guidance
Guidance from the call centers on a multi-quarter, multi‑year turnaround to grow net revenues and active brand partners back toward pre‑pandemic levels: management reiterated a focus on recruiting (they added over 1,300 new brand partners in March, a 20% increase since year‑end, bringing active partners above 5,200 and an average of 5,300 in Q1 versus 7,700 a year ago, with month‑end counts moving from ~4,300 to 5,200), conservative purchasing to replenish best‑sellers and introduce new titles (early success reported), and IT/product rollouts (AI “Read” launched; wishlist/registry and targeted offers planned) to reduce friction and boost sales; financial actions include expense reductions expected to exceed $1.2M for FY2027 to improve cash flow, inventory down from $37.7M to $36.2M (generating roughly $1.5M of cash), cash up from $1.3M to $1.8M in the quarter, while Q1 reported net revenues of $4.8M (vs $7.1M LY), net loss $1.4M (loss before tax $1.4M), and diluted loss per share $0.16 (vs $0.13); management expects to reach cash‑flow positivity and ultimately a return to profitability (which would reverse the current valuation allowance on deferred tax assets), but cautioned seasonality (Q2 is typically the slowest quarter) and that meaningful revenue/partner retention improvements may materialize over the next few quarters.Educational Development Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
78
Positive
Cash Flow
48
Neutral
| Breakdown | TTM | Feb 2026 | Feb 2025 | Feb 2024 | Feb 2023 | Feb 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 19.25M | 21.81M | 34.19M | 51.03M | 87.83M | 142.23M |
| Gross Profit | 12.29M | 13.60M | 21.03M | 32.98M | 56.07M | 97.93M |
| EBITDA | 8.87M | 14.11M | -2.94M | 5.98M | 1.22M | 14.28M |
| Net Income | 3.02M | 3.34M | -5.26M | 546.40K | -2.50M | 8.31M |
Balance Sheet | ||||||
| Total Assets | 52.88M | 56.99M | 78.31M | 90.11M | 99.94M | 109.93M |
| Cash, Cash Equivalents and Short-Term Investments | 1.66M | 1.34M | 428.40K | 844.50K | 689.10K | 361.20K |
| Total Debt | 6.74M | 6.72M | 32.40M | 35.55M | 46.35M | 43.17M |
| Total Liabilities | 11.48M | 14.20M | 37.75M | 44.65M | 54.70M | 63.17M |
| Stockholders Equity | 41.39M | 42.79M | 40.57M | 45.45M | 45.23M | 46.77M |
Cash Flow | ||||||
| Free Cash Flow | 741.70K | 1.46M | 2.77M | 7.93M | -1.52M | -24.86M |
| Operating Cash Flow | 1.17M | 2.01M | 3.21M | 8.75M | 58.50K | -21.14M |
| Investing Cash Flow | 29.46M | 29.39M | -429.60K | 4.04M | -1.76M | -3.94M |
| Financing Cash Flow | -30.58M | -31.03M | -3.08M | -12.20M | 2.03M | 23.63M |
Educational Development Technical Analysis
Positive
1.44
Price Trends
1.46
Positive
1.41
Positive
1.39
Positive
Market Momentum
0.04
Negative
67.81
Neutral
58.43
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EDUC, the sentiment is Positive. The current price of 1.44 is below the 20-day moving average (MA) of 1.50, below the 50-day MA of 1.46, and above the 200-day MA of 1.39, indicating a bullish trend. The MACD of 0.04 indicates Negative momentum. The RSI at 67.81 is Neutral, neither overbought nor oversold. The STOCH value of 58.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EDUC.
Educational Development Peers Comparison
UnderperformOutperform
Sector (60)
EDUC
Educational Development
1.57
0.23
17.16%
LEE
Lee Enterprises
8.33
1.53
22.50%
SCHL
Scholastic
45.17
24.26
115.98%
Educational Development Corporate Events
Business Operations and StrategyFinancial Disclosures
Educational Development Highlights Liquidity Amid Wider Quarterly Loss
Negative
Jul 9, 2026
Educational Development Corporation reported fiscal 2027 first quarter results on July 9, 2025, for the period ended May 31, 2026, showing net revenue falling to $4.8 million from $7.1 million and a wider net loss of $1.4 million, or $0.16 per sha...
Business Operations and StrategyFinancial Disclosures
Educational Development Sets Date for Q1 2027 Earnings Call
Neutral
Jun 16, 2026
On June 16, 2026, Educational Development Corporation announced it will hold its fiscal 2027 first-quarter earnings call on Thursday, July 9, 2026, at 3:30 p.m. CT. Chief Executive Officer Craig White, Chief Sales and Marketing Officer Heather Cob...
Business Operations and StrategyFinancial DisclosuresPrivate Placements and Financing
Educational Development Eliminates Debt, Initiates Turnaround Strategy
Negative
May 19, 2026
Educational Development Corporation reported that for the fiscal year ended February 28, 2026, net revenues fell to $22.9 million from $34.2 million as average active PaperPie brand partners dropped to 5,800 from 12,300. Despite a net earnings fig...
Financial DisclosuresShareholder Meetings
Educational Development Schedules Fiscal 2026 Earnings Call
Neutral
Apr 21, 2026
Educational Development Corporation announced on April 21, 2026 that it will hold its fiscal year 2026 earnings call on May 19, 2026 at 3:30 p.m. CT, where senior executives including the CEO, Chief Sales and Marketing Officer, and CFO will presen...
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.