Scholastic (NASDAQ:SCHL) Stock Gets Downgrade from Wall Street Zen

Key Points

• Wall Street Zen downgraded Scholastic from “hold” to “sell.” Other analysts remain more neutral, with a consensus “Hold” rating and an average price target of $35.
• Scholastic’s latest quarterly results fell short of expectations, reporting a loss of $3.63 per share versus the $3.42 consensus estimate and revenue of $216.8 million versus $224.69 million expected.
• Company insiders sold nearly $11.7 million of stock during the last quarter, including substantial sales by an executive vice president and a director; insiders own 12.77% of the company, while institutional investors own 82.57%.

Scholastic (NASDAQ:SCHL - Get Free Report) was downgraded by Wall Street Zen from a "hold" rating to a "sell" rating in a note issued to investors on Saturday, Wall Street Zen reports.

Other equities analysts also recently issued reports about the stock. B. Riley Financial lowered their target price on shares of Scholastic from $42.00 to $35.00 and set a "neutral" rating on the stock in a research report on Monday, September 28th. Zacks Research raised Scholastic from a "strong sell" rating to a "hold" rating in a research report on Tuesday, September 22nd. Finally, Weiss Ratings downgraded Scholastic from a "hold (c+)" rating to a "hold (c-)" rating in a research note on Monday, September 28th. Three equities research analysts have rated the stock with a Hold rating. According to data from MarketBeat.com, the company has a consensus rating of "Hold" and an average target price of $35.00.

Scholastic Stock Performance

SCHL stock opened at $38.60 on Friday. The firm has a 50 day moving average of $38.03 and a two-hundred day moving average of $40.54. Scholastic has a 12 month low of $26.38 and a 12 month high of $48.07. The company has a market capitalization of $728.00 million, a price-to-earnings ratio of 27.57, a P/E/G ratio of 2.09 and a beta of 1.08. The company has a quick ratio of 0.71, a current ratio of 1.25 and a debt-to-equity ratio of 0.27.

Scholastic (NASDAQ:SCHL - Get Free Report) last released its quarterly earnings results on Thursday, September 24th. The company reported ($3.63) earnings per share for the quarter, missing analysts' consensus estimates of ($3.42) by ($0.21). Scholastic had a net margin of 3.60% and a return on equity of 5.00%. The business had revenue of $216.80 million for the quarter, compared to the consensus estimate of $224.69 million. As a group, equities analysts anticipate that Scholastic will post 1.41 EPS for the current fiscal year.

Insider Buying and Selling

In other Scholastic news, EVP Iole Lucchese sold 289,624 shares of the business's stock in a transaction on Wednesday, August 26th. The shares were sold at an average price of $39.76, for a total transaction of $11,515,450.24. Following the completion of the transaction, the executive vice president owned 289,623 shares of the company's stock, valued at $11,515,410.48. The trade was a 50.00% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, Director Kaya Henderson sold 3,250 shares of the company's stock in a transaction dated Thursday, August 6th. The shares were sold at an average price of $40.25, for a total transaction of $130,812.50. Following the sale, the director owned 7,113 shares of the company's stock, valued at $286,298.25. This trade represents a 31.36% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 294,986 shares of company stock worth $11,731,334 in the last quarter. 12.77% of the stock is currently owned by company insiders.

Institutional Trading of Scholastic

Hedge funds have recently added to or reduced their stakes in the business. Quantinno Capital Management LP raised its stake in Scholastic by 3.2% during the 1st quarter. Quantinno Capital Management LP now owns 23,186 shares of the company's stock valued at $906,000 after purchasing an additional 729 shares during the last quarter. Meeder Asset Management Inc. bought a new stake in shares of Scholastic in the second quarter valued at about $43,000. Integrated Wealth Concepts LLC acquired a new stake in Scholastic during the second quarter worth about $56,000. Sanctuary Advisors LLC grew its position in Scholastic by 21.8% during the first quarter. Sanctuary Advisors LLC now owns 12,170 shares of the company's stock worth $475,000 after buying an additional 2,182 shares in the last quarter. Finally, State of Wyoming bought a new position in Scholastic during the second quarter valued at about $115,000. Institutional investors own 82.57% of the company's stock.

About Scholastic

Scholastic Corporation is a global children's publishing, education and media company founded in 1920 by M. R. Robinson. Headquartered in New York City, the company develops and distributes books, digital resources and educational materials for children, families, teachers and schools.

Its publishing portfolio includes picture books, middle-grade and young adult titles, classroom magazines, reference materials and educational technology. Scholastic is associated with well-known brands and series such as Harry Potter in the United States, Clifford the Big Red Dog, The Magic School Bus, Captain Underpants, Dog Man and Goosebumps.

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