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Grand Canyon Education
(NASDAQ:LOPE)
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Rating:73Outperform
Price Target:
$171.00
▲(14.70% Upside)
Action:Reiterated
Date:10/02/26
LOPE scores well primarily due to strong balance-sheet strength, healthy profitability, and consistently solid free cash flow generation. The score is held back by the sharp TTM revenue decline and only moderate technical trend strength (still below the 200-day average). Earnings call guidance and execution were generally supportive, but MSA-driven revenue headwinds and the interim-CFO/investigation corporate event add near-term uncertainty.
Positive Factors
Conservative balance sheet
Very low leverage gives Grand Canyon Education financial flexibility to fund technology, campus expansion, and other initiatives without excessive debt service. Strong returns on equity also indicate that the company is using its capital efficiently, supporting resilience through changing enrollment conditions.
Negative Factors
MSA fee restructuring
Because GCU has historically represented the substantial majority of revenue, the amended MSA creates a durable headwind to the company’s revenue base. Even with limited expected operating-income impact, the lower fee structure reduces monetization per student and raises dependence on enrollment growth and execution.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet
Very low leverage gives Grand Canyon Education financial flexibility to fund technology, campus expansion, and other initiatives without excessive debt service. Strong returns on equity also indicate that the company is using its capital efficiently, supporting resilience through changing enrollment conditions.
Read all positive factors
Grand Canyon Education (LOPE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.16B
Dividend YieldN/A
Average Volume (3M)298.45K
Price to Earnings (P/E)19.2
Beta (1Y)0.83
Revenue Growth6.97%
EPS Growth0.18%
CountryUS
Employees2,700
SectorConsumer Defensive
Sector Strength42
IndustryEducation & Training Services
Share Statistics
EPS (TTM)8.32
Shares Outstanding26,065,037
10 Day Avg. Volume237,932
30 Day Avg. Volume298,447
Financial Highlights & Ratios
PEG Ratio-166.52
Price to Book (P/B)6.20
Price to Sales (P/S)4.19
P/FCF Ratio19.42
Enterprise Value/Market Cap0.86
Enterprise Value/Revenue3.14
Enterprise Value/Gross Profit5.89
Enterprise Value/Ebitda10.90
Forecast
1Y Price Target
$191.00Price Target Upside28.12% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
EPS Forecast (FY)10.21
Revenue Forecast (FY)$1.17B
Grand Canyon Education Business Overview & Revenue Model
Company Description
Grand Canyon Education, Inc. (GCE) furnishes a broad spectrum of educational support services to higher education institutions throughout the United States. Its comprehensive suite of offerings encompasses technology solutions, such as learning ma...
How the Company Makes Money
Grand Canyon Education makes money primarily by providing bundled education support services under long-term contractual arrangements, most notably its master services agreement (MSA) with Grand Canyon University (GCU). Under this model, LOPE supp...
Grand Canyon Education Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call highlighted solid top‑line growth, improved margins, a meaningful EPS beat, and multiple strategic expansion initiatives (honors college, construction programs, planned law school, and hybrid scale opportunity). These positives are partly offset by an amended long‑term MSA that reduces service revenue by an estimated ~$20 million annually, timing shifts that depress near‑term revenue in Q3/Q4, program mix pressure on revenue per student, and some margin headwinds from rising costs and hybrid capacity constraints. Management expects the MSA to have only a small impact on operating income and reiterated buybacks, liquidity, and continued margin expansion for 2026, resulting in a constructive but cautious outlook.Positive Updates
Service Revenue Growth
Service revenue of $264.0 million in Q2 2026, up $16.5 million or 6.7% year-over-year (Q2 2025: $247.5M). Growth driven by partner enrollments and stronger hybrid/traditional summer enrollments.
Negative Updates
Amended Master Services Agreement Reduces Revenue
Amended and restated MSA with GCU effective July 1, 2026 restructures fees (service fees = 60% of tuition & academic fees; ancillary fees retained by GCU) and is estimated to reduce service revenue by approximately $20 million annually.
Read all updates
Q2-2026 Updates
Positive
Negative
Service Revenue Growth
Service revenue of $264.0 million in Q2 2026, up $16.5 million or 6.7% year-over-year (Q2 2025: $247.5M). Growth driven by partner enrollments and stronger hybrid/traditional summer enrollments.
Read all positive updates
Company Guidance
GCE updated full‑year 2026 guidance calling for adjusted EPS to be roughly $0.14 above consensus for the year and $0.03 above consensus in the second half (Q2 non‑GAAP EPS $1.81; GAAP $1.75), and reported Q2 service revenue of $264.0M (up $16.5M or 6.7% YoY), operating income $58.2M (22% margin), and net income $45.9M. The company said the amended MSA will reduce service revenue by about $20M annually (with operating income impact immaterial and not to exceed ~$1M/quarter), and it now expects revenue headwinds of $4M in Q3 and $6M in Q4, with instructional costs/services reduced by $3M and $5M in Q3 and Q4 respectively; $1M of revenue was accelerated into Q2 and semester timing moves $8.3M from Q3 to Q4. Key modeling assumptions include new online starts up mid‑to‑high single digits in H2, hybrid growth in the teens (currently ~6,000 hybrid students across 47 sites at ~60% capacity toward a target of 80 sites and ~600 students/site → ~50K capacity), fall ground enrollment ~25,000, 2026 CapEx $30–35M (Q2 CapEx $10.7M, 4.1% of service revenue), cash & investments $274.5M, share repurchases of 471K shares ($75.3M) in Q2 plus 169K since June 30 with $124.1M remaining authorization, a planned line of credit by mid‑August, declining interest income, and an effective tax rate of 23.2% for the year (Q3 20.8%, Q4 23.2%) after a $5M contribution in lieu of state taxes.Grand Canyon Education Financial Statement Overview
Summary
Income Statement
71
Positive
Balance Sheet
86
Very Positive
Cash Flow
79
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.14B | 1.11B | 1.03B | 960.90M | 911.31M | 896.56M |
| Gross Profit | 608.39M | 588.36M | 544.43M | 503.71M | 487.50M | 515.31M |
| EBITDA | 328.71M | 319.75M | 327.87M | 291.68M | 271.30M | 365.30M |
| Net Income | 224.21M | 216.17M | 226.23M | 204.99M | 184.68M | 260.34M |
Balance Sheet | ||||||
| Total Assets | 919.18M | 992.30M | 1.02B | 930.46M | 832.75M | 1.22B |
| Cash, Cash Equivalents and Short-Term Investments | 274.53M | 300.08M | 324.62M | 244.51M | 181.70M | 600.94M |
| Total Debt | 104.21M | 200.08M | 108.52M | 99.28M | 77.44M | 61.18M |
| Total Liabilities | 249.67M | 245.37M | 234.57M | 212.45M | 195.13M | 177.70M |
| Stockholders Equity | 669.51M | 746.93M | 783.85M | 718.01M | 637.62M | 1.05B |
Cash Flow | ||||||
| Free Cash Flow | 242.49M | 238.59M | 252.71M | 198.23M | 185.19M | 283.73M |
| Operating Cash Flow | 278.71M | 273.49M | 289.96M | 243.66M | 220.82M | 313.12M |
| Investing Cash Flow | 42.78M | -221.59M | 61.37M | -80.47M | -97.14M | 950.98M |
| Financing Cash Flow | -342.71M | -264.76M | -173.18M | -137.12M | -604.21M | -908.93M |
Grand Canyon Education Technical Analysis
Positive
149.08
Price Trends
152.52
Positive
149.70
Positive
158.05
Positive
Market Momentum
3.08
Negative
69.67
Neutral
65.52
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOPE, the sentiment is Positive. The current price of 149.08 is below the 20-day moving average (MA) of 156.93, below the 50-day MA of 152.52, and below the 200-day MA of 158.05, indicating a bullish trend. The MACD of 3.08 indicates Negative momentum. The RSI at 69.67 is Neutral, neither overbought nor oversold. The STOCH value of 65.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LOPE.
Grand Canyon Education Risk Analysis
Grand Canyon Education disclosed 39 risk factors in its most recent earnings report. Grand Canyon Education reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Grand Canyon Education Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $3.17B | 9.67 | 20.59% | ― | 2.48% | 7.90% | |
74 Outperform | $5.18B | 9.76 | 11.56% | 0.61% | 4.83% | -20.20% | |
74 Outperform | $5.28B | 17.26 | 28.61% | 5.23% | 17.89% | 31.70% | |
73 Outperform | $4.16B | 19.20 | 31.24% | ― | 6.97% | 0.18% | |
65 Neutral | $2.73B | 30.89 | 12.02% | ― | 0.14% | ― | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% |
* Consumer Defensive Sector Average
LOPE
Grand Canyon Education
165.46
-55.09
-24.98%
LRN
Stride
80.68
-71.26
-46.90%
GHC
Graham Holdings
1,239.59
231.60
22.98%
LAUR
Laureate Education
38.79
9.01
30.26%
MH
McGraw Hill, Inc.
14.80
2.18
17.27%
Grand Canyon Education Corporate Events
Business Operations and StrategyStock BuybackPrivate Placements and Financing
Grand Canyon Education Establishes New $100 Million Credit Facility
Positive
Oct 1, 2026
On September 28, 2026, Grand Canyon Education entered into a five-year senior secured revolving credit facility of up to $100 million, arranged by Zions Bancorporation’s National Bank of Arizona, with a $10 million sublimit for letters of cr...
Executive/Board ChangesLegal Proceedings
Grand Canyon Education Names Interim CFO Amid Investigation
Negative
Aug 24, 2026
Grand Canyon Education’s board of directors has placed Chief Financial Officer Daniel E. Bachus on paid administrative leave, effective August 21, 2026, in connection with a governmental investigation into trades in company stock by a non-em...
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.