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Franklin Covey Company (FC) AI Stock Analysis
Franklin Covey Company
(NYSE:FC)
The score is held back primarily by sharply weaker TTM profitability and clearly bearish price momentum, with additional drag from a very high P/E and no dividend support. Offsetting these are a debt-free balance sheet and solid absolute cash generation, plus an earnings call that maintained EBITDA guidance and pointed to improving profitability and strong bookings/deferred revenue momentum despite a modest revenue guidance cut and near-term international/education funding headwinds.
Franklin Covey Company (FC) vs. SPDR S&P 500 ETF (SPY)
- Market Cap
- $195.95M
- Dividend Yield
- ―
- Average Volume (3M)
- 58.53K
- Price to Earnings (P/E)
- 96.4
- Beta (1Y)
- 1.52
- Revenue Growth
- -6.14%
- EPS Growth
- -78.29%
- Country
- US
- Employees
- 1,120
- Sector
- Consumer Defensive
- Sector Strength
- 62
- Industry
- Education & Training Services
Franklin Covey Company Business Overview & Revenue Model
Company Description
Franklin Covey Co. provides specialized training and advisory services across the globe, assisting both businesses and individuals. The company's expertise lies in critical areas like operational efficiency, improving sales results, enhancing overall...
How the Company Makes Money
Franklin Covey primarily makes money by selling organizational training and performance-improvement solutions under multi-format delivery models. A major revenue stream is subscription-based access to its digital content and enablement platform(s), w...
Franklin Covey Company Earnings Call Summary
The call communicated clear underlying momentum in recurring subscription and services bookings (subscription/committed invoiced +17%, services bookings +25% YTD, deferred revenue +7% company / +18% NA billed), improved adjusted EBITDA and net income, and maintained EBITDA guidance despite a modest revenue guidance reduction driven by timing and geopolitical items. Key short-term challenges include China and international headwinds, a delayed statewide education funding (~$2M immediate impact, larger FY effect), a YoY gross margin decline, and negative free cash flow in the quarter. Management emphasized operational resilience, go-to-market transformation payoff in Enterprise North America, and positioning for accelerated growth in fiscal 2027. Overall, the positives around bookings, deferred revenue runway, profitability improvements, and liquidity outweigh the transitory challenges discussed.
Q3-2026 Updates
Positive Updates
Negative Updates
Company Guidance
Management revised fiscal 2026 revenue guidance to $260–$267 million while maintaining adjusted EBITDA guidance at $28–$31 million (in a narrower range), citing a ~$2M timing shift of previously invoiced Enterprise North America services, up to $2M of delayed statewide education funding and roughly $2M of international/geopolitical headwinds. They pointed to supporting momentum: consolidated deferred revenue up 7% YoY to $96M, Enterprise North America billed deferred revenue up 18% to $58M, consolidated subscription and contractually committed invoiced amounts up 17% in Q3 to $37M, services booking pace up >25% YTD and materially more services already contracted for fiscal 2027. Quarter highlights included Q3 reported revenue $67.8M (+1% YoY), Q3 adjusted EBITDA $8.3M (+14% YoY), gross margin 73.9% (vs. 76.5% prior year), enterprise = 71% of revenue, education = $19M (+2%) with education subscription revenue +11% in Q3 (+14% YTD), liquidity >$74M (including $12M cash and a $62.5M credit facility), ~1.6M shares repurchased for $28.1M YTD ($50M authorization; $20M remaining), operating cash flow YTD $17.5M (‑8%) and Q3 free cash flow of ‑$1M.
Franklin Covey Company Financial Statement Overview
Summary
Mixed fundamentals: revenue rebounded strongly (+26.2% TTM) and gross margin remains high (~73–77%), supported by solid operating cash flow ($27.4M) and free cash flow ($17.2M). However, profitability has compressed sharply versus FY2024 (TTM net margin ~0.8%, EBIT margin ~2.8%) and free cash flow is down (-14.0% TTM), indicating weaker conversion of gross profit into earnings/cash.
Income Statement
55NeutralBalance Sheet
72PositiveCash Flow
63Positive| Breakdown | TTM | Aug 2025 | Aug 2024 | Aug 2023 | Aug 2022 | Aug 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 262.75M | 267.07M | 287.23M | 280.52M | 262.84M | 224.17M |
| Gross Profit | 192.14M | 203.57M | 221.07M | 213.49M | 201.91M | 172.90M |
| EBITDA | 16.48M | 18.96M | 46.25M | 39.98M | 38.17M | 23.82M |
| Net Income | 2.19M | 3.07M | 23.40M | 17.78M | 18.43M | 13.62M |
Balance Sheet | ||||||
| Total Assets | 198.01M | 242.91M | 261.54M | 245.92M | 259.15M | 249.65M |
| Cash, Cash Equivalents and Short-Term Investments | 11.97M | 31.70M | 48.66M | 38.23M | 60.52M | 47.42M |
| Total Debt | 0 | 7.82M | 6.03M | 15.33M | 24.26M | 32.86M |
| Total Liabilities | 155.07M | 176.00M | 178.40M | 167.26M | 176.34M | 169.79M |
| Stockholders Equity | 42.94M | 66.91M | 83.14M | 78.65M | 82.81M | 79.86M |
Cash Flow | ||||||
| Free Cash Flow | 17.23M | 12.09M | 56.56M | 22.19M | 46.92M | 42.07M |
| Operating Cash Flow | 27.41M | 28.98M | 60.26M | 35.74M | 52.25M | 46.18M |
| Investing Cash Flow | -17.42M | -16.89M | -11.31M | -13.55M | -5.33M | -14.31M |
| Financing Cash Flow | -41.90M | -28.78M | -38.66M | -44.18M | -32.67M | -11.48M |
Franklin Covey Company Technical Analysis
Price Trends
Market Momentum
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FC, the sentiment is Negative. The current price of 18.13 is below the 20-day moving average (MA) of 18.23, below the 50-day MA of 18.28, and below the 200-day MA of 19.61, indicating a bearish trend. The MACD of -0.03 indicates Positive momentum. The RSI at 39.17 is Neutral, neither overbought nor oversold. The STOCH value of 27.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FC.
Franklin Covey Company Risk Analysis
Franklin Covey Company disclosed 29 risk factors in its most recent earnings report. Franklin Covey Company reported the most risks in the "Finance & Corporate" category.
Latest Risks Added
0 New RisksFranklin Covey Company Peers Comparison
Overall Rating
STRA72Outperform
MH69Neutral- FC57Neutral
COUR56Neutral
SKIL42Neutral
GNS40Underperform
Financial Indicators
| Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| STRA | 72Outperform | $1.62B | 11.80 | 8.19% | 3.31% | 3.53% | 23.97% |
| MH | 69Neutral | $2.55B | 27.19 | 12.02% | ― | 0.14% | ― |
| Sector * | 62Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% |
| FC | 57Neutral | $204.42M | 96.39 | 4.33% | ― | -6.14% | -78.29% |
| COUR | 56Neutral | $917.47M | -4.99 | -17.56% | ― | 44.35% | -154.13% |
| SKIL | 42Neutral | $43.23M | -0.25 | 339.96% | ― | -13.66% | -10.94% |
| GNS | 40Underperform | $23.07M | -0.48 | -14.33% | 176.99% | 106.42% | 56.99% |
* Consumer Defensive Sector Average
Performance Comparison
| Show on chart | Ticker | Company Name | Price | Change | % Change |
|---|---|---|---|---|---|
| FC | Franklin Covey | 17.35 | 0.53 | 3.15% | |
| STRA | Strategic Education | 72.57 | -0.24 | -0.33% | |
| SKIL | Skillsoft Corp | 4.61 | -7.76 | -62.73% | |
| COUR | Coursera Inc | 3.79 | -4.28 | -53.04% | |
| GNS | Genius Group Limited | 0.11 | -0.63 | -84.73% | |
| MH | McGraw Hill, Inc. | 12.78 | 1.88 | 17.25% |
Franklin Covey Company Corporate Events
FranklinCovey Announces Key Leadership Changes and Succession Plans
PositiveOn September 1, 2026, FranklinCovey announced a series of leadership changes, including the appointment of longtime executive and author M. Sean Covey as Chief Product Officer, shifting him from his role as President of the Education Division. The co...
Franklin Covey Reports Q3 Results, Lowers 2026 Guidance
NeutralFranklin Covey Co. reported its fiscal third-quarter 2026 results, for the period ended May 31, 2026, with consolidated revenue edging up 1% year over year to $67.8 million, driven by growth in both the Enterprise and Education divisions and a 4% ris...
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: Sep 06, 2026