Bright Horizons Family Solutions (NYSE:BFAM) Shares Gap Up After Earnings Beat

Key Points

• Bright Horizons Family Solutions shares surged from a previous close of $113.10 to an opening of $127.37 following a strong earnings report, reporting $1.07 EPS, surpassing analyst expectations of $1.00.
• The company achieved a revenue of $731.57 million for the quarter, marking a 9.2% increase year-over-year compared to the same quarter last year.
• Recent analyst reports present a mixed outlook, with Morgan Stanley lowering its price target to $100.00 and other analysts showing varied ratings including a consensus target price of $138.00.

Bright Horizons Family Solutions Inc. (NYSE:BFAM - Get Free Report) gapped up before the market opened on Friday after the company announced better than expected quarterly earnings. The stock had previously closed at $113.10, but opened at $127.37. Bright Horizons Family Solutions shares last traded at $122.72, with a volume of 152,385 shares changing hands.

The company reported $1.07 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.00 by $0.07. The firm had revenue of $731.57 million during the quarter, compared to analysts' expectations of $724.32 million. Bright Horizons Family Solutions had a net margin of 6.34% and a return on equity of 15.31%. The company's revenue was up 9.2% compared to the same quarter last year. During the same period in the previous year, the company earned $0.88 earnings per share.

Analyst Upgrades and Downgrades

A number of brokerages have issued reports on BFAM. Morgan Stanley reduced their price objective on Bright Horizons Family Solutions from $106.00 to $100.00 and set an "underweight" rating for the company in a research note on Monday, July 28th. Jefferies Financial Group lowered Bright Horizons Family Solutions from a "buy" rating to a "hold" rating and cut their price objective for the stock from $146.00 to $135.00 in a report on Monday, June 23rd. One analyst has rated the stock with a sell rating, four have assigned a hold rating, five have issued a buy rating and one has given a strong buy rating to the stock. According to MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average price target of $138.00.

Insider Transactions at Bright Horizons Family Solutions

In related news, Director Mary Ann Tocio sold 2,500 shares of the business's stock in a transaction that occurred on Thursday, May 29th. The stock was sold at an average price of $128.49, for a total transaction of $321,225.00. Following the completion of the sale, the director owned 20,257 shares in the company, valued at $2,602,821.93. The trade was a 10.99% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, Director David H. Lissy sold 6,282 shares of Bright Horizons Family Solutions stock in a transaction that occurred on Wednesday, May 28th. The shares were sold at an average price of $130.10, for a total value of $817,288.20. Following the completion of the transaction, the director owned 69,312 shares in the company, valued at $9,017,491.20. This trade represents a 8.31% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last three months, insiders sold 13,282 shares of company stock valued at $1,723,633. Insiders own 1.21% of the company's stock.

Institutional Trading of Bright Horizons Family Solutions

Several hedge funds have recently made changes to their positions in the stock. T. Rowe Price Investment Management Inc. grew its holdings in shares of Bright Horizons Family Solutions by 60.4% during the fourth quarter. T. Rowe Price Investment Management Inc. now owns 4,958,538 shares of the company's stock valued at $549,654,000 after buying an additional 1,868,117 shares in the last quarter. JPMorgan Chase & Co. increased its stake in Bright Horizons Family Solutions by 23.8% during the first quarter. JPMorgan Chase & Co. now owns 4,391,997 shares of the company's stock valued at $557,959,000 after acquiring an additional 845,391 shares during the period. Kayne Anderson Rudnick Investment Management LLC grew its stake in shares of Bright Horizons Family Solutions by 3.1% in the 1st quarter. Kayne Anderson Rudnick Investment Management LLC now owns 3,200,371 shares of the company's stock valued at $406,575,000 after purchasing an additional 95,860 shares during the period. Massachusetts Financial Services Co. MA boosted its holdings in shares of Bright Horizons Family Solutions by 1.1% in the 1st quarter. Massachusetts Financial Services Co. MA now owns 2,589,014 shares of the company's stock worth $328,908,000 after acquiring an additional 29,425 shares in the last quarter. Finally, Bamco Inc. NY lifted its stake in shares of Bright Horizons Family Solutions by 4.7% in the 4th quarter. Bamco Inc. NY now owns 1,559,277 shares of the company's stock valued at $172,846,000 after purchasing an additional 69,940 shares during the period.

Bright Horizons Family Solutions Trading Up 10.6%

The company has a fifty day simple moving average of $120.82 and a two-hundred day simple moving average of $122.04. The stock has a market capitalization of $7.16 billion, a P/E ratio of 41.01 and a beta of 1.34. The company has a quick ratio of 0.60, a current ratio of 0.60 and a debt-to-equity ratio of 0.66.

About Bright Horizons Family Solutions

Bright Horizons Family Solutions Inc provides early education and childcare, back-up care, educational advisory, and other workplace solutions services for employers and families in the United States, Puerto Rico, the United Kingdom, the Netherlands, Australia, and India. The company operates in three segments: Full Service Center-Based Child Care, Back-Up Care, and Educational Advisory and Other Services.