Student loan provider Sallie Mae (NASDAQ: SLM) will be reporting results this Thursday after market hours. Here’s what to look for.
Sallie Mae beat analysts’ revenue expectations last quarter, reporting revenues of $454.1 million, up 16.4% year on year. It was a strong quarter for the company, with a beat of analysts’ EPS estimates and a narrow beat of analysts’ revenue estimates.
Is Sallie Mae a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Sallie Mae’s revenue to decline 7.3% year on year, a reversal from the 3.5% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Sallie Mae has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Sallie Mae’s peers in the consumer finance segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Ally Financial delivered year-on-year revenue growth of 5.5%, beating analysts’ expectations by 1.7%, and Synchrony Financial reported flat revenue, falling short of estimates by 2.4%. Ally Financial traded up 10.3% following the results.
Read our full analysis of Ally Financial’s results here and Synchrony Financial’s results here.
There has been positive sentiment among investors in the consumer finance segment, with share prices up 11.8% on average over the last month. Sallie Mae is up 13.2% during the same time and is heading into earnings with an average analyst price target of $28.18 (compared to the current share price of $22.78).
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