Scholastic Corporation (NASDAQ:SCHL), a leading publisher and distributor of children's books, has seen its stock price tumble to $21.19, trading near its 52-week low. According to InvestingPro analysis, the stock appears undervalued at current levels, while maintaining a solid 3.2% dividend yield that has been consistently paid for 17 consecutive years. This latest price point underscores a challenging period for the company, which has experienced a significant downturn over the past year. The stock's performance reflects a stark 1-year change, with Scholastic's market value eroding by -35.43%. Despite these challenges, management has shown confidence through aggressive share buybacks, and the company maintains strong fundamentals with liquid assets exceeding short-term obligations. Investors and analysts are closely monitoring the company's strategic moves to navigate through the current market headwinds that have heavily impacted the publishing industry at large. Get access to 6 more exclusive InvestingPro Tips and comprehensive analysis in the Pro Research Report.
In other recent news, Scholastic Corporation reported fiscal second quarter results that fell short of analyst expectations, leading to a 14% drop in shares. The children's book publisher posted adjusted earnings per share of $1.82, notably lower than the projected $2.93. Revenue also decreased by 3% year-over-year to $544.6 million, missing estimates of $587.06 million.
The revenue decline was primarily attributed to timing-related factors in its Children's Book Publishing and Distribution segment, including the current year's publishing plan and fall fair bookings. Notably, Book Fairs revenue dropped 5% year-over-year to $231 million due to fewer fairs held in the quarter.
Despite the disappointing results, Scholastic reaffirmed its fiscal 2025 guidance, expressing confidence in its ability to navigate market conditions and achieve its full-year plan. Additionally, the company has upsized its revolving credit facility to $400 million, indicating a strategic move to bolster its financial position amidst these developments.
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