Scholastic (NASDAQ:SCHL) Shares Gap Down Following Weak Earnings

Key Points

• Scholastic's shares gapped down to $23.53 following a disappointing earnings report, with an EPS of ($2.52) that missed estimates by $0.08.
• The company announced a quarterly dividend of $0.20 per share, payable on December 15th, which represents a yield of 3.3% despite a negative dividend payout ratio of -2,000.00%.
• Wall Street analysts have mixed views on Scholastic, with one rating the stock as a "buy" and setting a price target of $37.00, while others have downgraded it to a "hold" rating.

Scholastic Corporation (NASDAQ:SCHL - Get Free Report) shares gapped down prior to trading on Friday following a weaker than expected earnings announcement. The stock had previously closed at $27.54, but opened at $23.53. Scholastic shares last traded at $23.62, with a volume of 464,391 shares trading hands.

The company reported ($2.52) earnings per share (EPS) for the quarter, missing the consensus estimate of ($2.44) by ($0.08). The firm had revenue of $225.60 million for the quarter, compared to the consensus estimate of $240.41 million. Scholastic had a positive return on equity of 1.08% and a negative net margin of 0.65%.During the same quarter in the previous year, the business posted ($2.13) EPS. Scholastic has set its FY 2026 guidance at EPS.

Scholastic Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Monday, December 15th. Shareholders of record on Friday, October 31st will be given a $0.20 dividend. This represents a $0.80 dividend on an annualized basis and a yield of 3.3%. The ex-dividend date of this dividend is Friday, October 31st. Scholastic's dividend payout ratio (DPR) is currently -121.21%.

Wall Street Analyst Weigh In

A number of research analysts have weighed in on SCHL shares. Wall Street Zen lowered Scholastic from a "buy" rating to a "hold" rating in a report on Friday, September 5th. B. Riley started coverage on Scholastic in a report on Wednesday, September 3rd. They set a "buy" rating and a $37.00 target price for the company. One investment analyst has rated the stock with a Buy rating, According to data from MarketBeat, the stock has an average rating of "Buy" and an average target price of $37.00.

Hedge Funds Weigh In On Scholastic

A number of hedge funds and other institutional investors have recently modified their holdings of SCHL. Peapod Lane Capital LLC bought a new stake in shares of Scholastic in the first quarter worth about $505,000. GAMMA Investing LLC boosted its position in shares of Scholastic by 182.4% during the 1st quarter. GAMMA Investing LLC now owns 1,776 shares of the company's stock valued at $34,000 after acquiring an additional 1,147 shares during the last quarter. Victory Capital Management Inc. bought a new position in shares of Scholastic during the 1st quarter valued at approximately $414,000. Ananym Capital Management LP bought a new position in shares of Scholastic during the 1st quarter valued at approximately $23,600,000. Finally, Allianz Asset Management GmbH boosted its position in shares of Scholastic by 21.6% during the 1st quarter. Allianz Asset Management GmbH now owns 254,340 shares of the company's stock valued at $4,802,000 after acquiring an additional 45,253 shares during the last quarter. Institutional investors own 82.57% of the company's stock.

Scholastic Stock Down 12.0%

The company has a current ratio of 1.16, a quick ratio of 0.76 and a debt-to-equity ratio of 0.26. The stock has a market capitalization of $606.96 million, a P/E ratio of -36.71 and a beta of 1.24. The business has a 50-day moving average price of $24.97 and a 200 day moving average price of $20.93.

About Scholastic

Scholastic Corporation publishes and distributes children's books worldwide. It operates in three segments: Children's Book Publishing and Distribution, Education Solutions, and International. The Children's Book Publishing and Distribution segment engages in publication and distribution of children's print, digital, and audio books, as well as media and interactive products through its school reading events and trade channel; and operation of school-based book clubs and book fairs in the United States.