Educational Development Is Thriving After Teaching Amazon A Lesson
John Leonard, CFA • Yesterday, 6:30 AM
- The lost revenue from Amazon has been replaced in less than two years; the UBAM division just posted its 16th consecutive month of revenue growth after nine years of declines.
- The near doubling of new sales reps in 1H15 is a significant catalyst and reverses the decline in the active sales rep base.
- There should be a sharp rebound in cash flow as higher inventories to support the key fall selling season and a larger slate of new titles are worked down.
- Stronger growth in the higher-margin publishing division along with lower shipping costs should drive continued EBITDA growth.
- The downside is limited by the 7.6% yield, opportunistic repurchase program and low float due to long term holders who own a third of the stock.