Scholastic (NASDAQ:SCHL) Sets New 12-Month High - What's Next?

Key Points

• Shares of Scholastic hit a new 52-week high of $40.15 (last $39.90) on Wednesday, and analysts have raised ratings/targets around $40 with upgrades from Zacks and others signaling growing optimism.
• Scholastic beat EPS expectations in the latest quarter (−$0.15 actual vs. −$0.37 expected) while revenue was roughly in line, and it trades at a market cap of about $867M with a P/E of 16.1.
• The board authorized a $200 million buyback (up to ~23% of shares) and declared a quarterly dividend of $0.20 (2.0% yield), underscoring a focus on returning capital to shareholders.

Shares of Scholastic Corporation (NASDAQ:SCHL - Get Free Report) hit a new 52-week high during trading on Wednesday . The company traded as high as $40.15 and last traded at $39.90, with a volume of 762758 shares traded. The stock had previously closed at $39.58.

Analyst Upgrades and Downgrades

SCHL has been the subject of a number of research reports. B. Riley Financial raised their price objective on Scholastic from $37.00 to $40.00 and gave the stock a "neutral" rating in a research report on Friday, March 20th. Zacks Research upgraded Scholastic from a "hold" rating to a "strong-buy" rating in a research report on Friday, April 3rd. Weiss Ratings upgraded Scholastic from a "sell (d+)" rating to a "hold (c-)" rating in a research report on Friday, January 30th. Finally, Wall Street Zen upgraded Scholastic from a "hold" rating to a "buy" rating in a research report on Saturday, March 21st. One equities research analyst has rated the stock with a Strong Buy rating and two have given a Hold rating to the company's stock. Based on data from MarketBeat, Scholastic presently has an average rating of "Moderate Buy" and a consensus target price of $40.00.

Scholastic Stock Performance

The firm has a market cap of $867.43 million, a P/E ratio of 16.09 and a beta of 1.08. The company has a 50-day moving average of $35.82 and a 200 day moving average of $32.02.

Scholastic (NASDAQ:SCHL - Get Free Report) last posted its earnings results on Thursday, March 19th. The company reported ($0.15) EPS for the quarter, topping the consensus estimate of ($0.37) by $0.22. The business had revenue of $329.10 million during the quarter, compared to the consensus estimate of $331.53 million. Scholastic had a return on equity of 2.47% and a net margin of 3.88%. Sell-side analysts anticipate that Scholastic Corporation will post 0.84 EPS for the current fiscal year.

Scholastic Announces Dividend

The firm also recently declared a quarterly dividend, which will be paid on Monday, June 15th. Investors of record on Thursday, April 30th will be issued a dividend of $0.20 per share. This represents a $0.80 dividend on an annualized basis and a yield of 2.0%. The ex-dividend date of this dividend is Thursday, April 30th. Scholastic's dividend payout ratio (DPR) is currently 32.26%.

Scholastic announced that its board has authorized a share buyback plan on Friday, March 20th that allows the company to buyback $200.00 million in shares. This buyback authorization allows the company to repurchase up to 23% of its shares through open market purchases. Shares buyback plans are often a sign that the company's board of directors believes its stock is undervalued.

Institutional Investors Weigh In On Scholastic

Hedge funds and other institutional investors have recently made changes to their positions in the company. GAMMA Investing LLC increased its stake in shares of Scholastic by 63.1% in the 3rd quarter. GAMMA Investing LLC now owns 2,540 shares of the company's stock valued at $70,000 after buying an additional 983 shares during the period. Tower Research Capital LLC TRC increased its stake in shares of Scholastic by 458.1% in the 2nd quarter. Tower Research Capital LLC TRC now owns 3,159 shares of the company's stock valued at $66,000 after buying an additional 2,593 shares during the period. Marquette Asset Management LLC acquired a new stake in shares of Scholastic in the 4th quarter valued at $116,000. State of Wyoming acquired a new stake in shares of Scholastic in the 3rd quarter valued at $137,000. Finally, BNP Paribas Financial Markets increased its stake in shares of Scholastic by 127.4% in the 3rd quarter. BNP Paribas Financial Markets now owns 5,197 shares of the company's stock valued at $142,000 after buying an additional 2,912 shares during the period. 82.57% of the stock is owned by institutional investors and hedge funds.

About Scholastic

Scholastic Corporation NASDAQ: SCHL is a global company dedicated to children's publishing, education technology and distribution services. The company's core business encompasses three primary segments: Children's Book Publishing and Distribution, Education Technology, and International operations. Through its publishing arm, Scholastic produces and distributes a wide range of children's books, novels, nonfiction titles and classroom magazines under well-known imprints such as Scholastic Press, Graphix and Chicken House.

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