Bright Horizons Family Solutions (NYSE:BFAM) Posts Earnings Results, Beats Estimates By $0.07 EPS

Key Points

• Bright Horizons exceeded second-quarter expectations: Revenue rose 7% to $779 million and adjusted EPS increased 20% to $1.28, beating estimates by $0.07, while the adjusted operating margin expanded to 12.7%.
• Back-up Care drove growth, with revenue up 19% to $194 million; the company raised its full-year Back-up Care growth outlook to 13%-15%.
• Full-year adjusted EPS guidance increased to $5.05-$5.15, alongside a narrowed revenue outlook of $3.085 billion-$3.115 billion. Australia remains a significant drag, with estimated annual operating losses of $20 million-$25 million, while the company repurchased about $250 million of shares during the quarter.

Bright Horizons Family Solutions (NYSE:BFAM - Get Free Report) released its quarterly earnings results on Thursday. The company reported $1.28 earnings per share for the quarter, topping the consensus estimate of $1.21 by $0.07, FiscalAI reports. Bright Horizons Family Solutions had a net margin of 6.35% and a return on equity of 18.01%. The firm had revenue of $779.18 million for the quarter, compared to analysts' expectations of $774.84 million. Bright Horizons Family Solutions updated its FY 2026 guidance to 5.050-5.150 EPS.

Here are the key takeaways from Bright Horizons Family Solutions' conference call:

• Second-quarter results exceeded expectations: Revenue increased 7% to $779 million, adjusted EPS rose 20% to $1.28, and adjusted operating margin expanded 95 basis points to 12.7%.
• Back-up Care remained the primary growth engine. Revenue grew 19% to $194 million on increased users and frequency, prompting the company to raise its full-year Back-up Care growth outlook to 13%-15%; management said the growth was broad-based rather than driven by unusual factors.
• Full-service occupancy improved sequentially to the high-60% range, or approximately 70% excluding Australia. Management sees a path toward restoring full-service margins to the historical 10% level as enrollment improves and underperforming centers are closed or optimized.
• Australia continues to weigh on the full-service business, creating roughly a 100-basis-point enrollment headwind and an estimated $20 million-$25 million annual operating loss. The company is aligning staffing, evaluating additional closures, and considering broader strategic options for the geography.
• The company narrowed its full-year revenue outlook to $3.085 billion-$3.115 billion and raised adjusted EPS guidance to $5.05-$5.15. Bright Horizons also repurchased approximately $250 million of shares in the quarter, while ending with 2.2x net leverage.

Bright Horizons Family Solutions Price Performance

Shares of NYSE BFAM traded down $4.82 during mid-day trading on Thursday, reaching $77.86. 925,016 shares of the company were exchanged, compared to its average volume of 1,043,509. Bright Horizons Family Solutions has a 52 week low of $57.63 and a 52 week high of $130.76. The company has a quick ratio of 0.46, a current ratio of 0.46 and a debt-to-equity ratio of 0.78. The stock has a market capitalization of $4.10 billion, a PE ratio of 23.45, a PEG ratio of 1.38 and a beta of 1.15. The company's 50 day moving average price is $69.34 and its 200 day moving average price is $76.89.

Insider Transactions at Bright Horizons Family Solutions

In related news, COO Mary Lou Burke sold 500 shares of the stock in a transaction on Tuesday, July 28th. The stock was sold at an average price of $80.00, for a total value of $40,000.00. Following the transaction, the chief operating officer owned 33,345 shares of the company's stock, valued at $2,667,600. This represents a 1.48% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Company insiders own 1.21% of the company's stock.

Hedge Funds Weigh In On Bright Horizons Family Solutions

Hedge funds and other institutional investors have recently modified their holdings of the company. Fuller & Thaler Asset Management Inc. purchased a new position in shares of Bright Horizons Family Solutions during the 4th quarter valued at about $191,952,000. AQR Capital Management LLC boosted its stake in Bright Horizons Family Solutions by 64.4% in the fourth quarter. AQR Capital Management LLC now owns 1,579,757 shares of the company's stock worth $160,124,000 after buying an additional 619,067 shares in the last quarter. Millennium Management LLC boosted its stake in Bright Horizons Family Solutions by 14.3% in the fourth quarter. Millennium Management LLC now owns 1,329,253 shares of the company's stock worth $134,786,000 after buying an additional 165,962 shares in the last quarter. Morgan Stanley boosted its stake in shares of Bright Horizons Family Solutions by 25.7% in the 4th quarter. Morgan Stanley now owns 1,066,234 shares of the company's stock valued at $108,116,000 after purchasing an additional 217,963 shares in the last quarter. Finally, Dimensional Fund Advisors LP raised its position in Bright Horizons Family Solutions by 3.1% in the 4th quarter. Dimensional Fund Advisors LP now owns 1,017,731 shares of the company's stock worth $103,200,000 after purchasing an additional 30,184 shares during the period.

Analyst Upgrades and Downgrades

BFAM has been the subject of several recent analyst reports. Weiss Ratings cut Bright Horizons Family Solutions from a "hold (c-)" rating to a "sell (d+)" rating in a research report on Friday, May 1st. JPMorgan Chase & Co. lowered their price target on Bright Horizons Family Solutions from $115.00 to $105.00 and set an "overweight" rating on the stock in a report on Wednesday, May 6th. Finally, UBS Group lowered their price target on Bright Horizons Family Solutions from $88.00 to $87.00 and set a "neutral" rating on the stock in a report on Friday, July 17th. Four research analysts have rated the stock with a Buy rating, three have issued a Hold rating and two have issued a Sell rating to the company's stock. According to MarketBeat.com, the company presently has a consensus rating of "Hold" and a consensus target price of $96.00.

About Bright Horizons Family Solutions

Bright Horizons Family Solutions, Inc NYSE: BFAM is a leading provider of employer-sponsored child care and early education services, offering a range of solutions designed to support working families and organizations. Through a network of on-site, near-site and center-based programs, the company partners with corporate and nonprofit clients to deliver infant, toddler, preschool and school-age care. Services emphasize age-appropriate curriculum, developmental milestones and community engagement to ensure high-quality learning experiences.

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