HOBOKEN, N.J. - John Wiley & Sons, Inc. (NYSE: WLY) reported a solid third quarter with adjusted earnings surpassing analyst expectations and revenue outperforming consensus estimates. The publisher announced Q3 adjusted EPS of $0.59, which was $0.14 higher than the analyst estimate of $0.45. Revenue for the quarter was also strong at $461 million, significantly exceeding the consensus estimate of $392.6 million.
The company's stock responded positively to the news, rising 2.23% in after-hours Wednesday trading, indicating investor confidence in the company's performance and prospects.
For the third quarter, Wiley's adjusted revenue saw a modest increase of 1% compared to the same quarter last year, reaching $403 million. This growth was driven by a 1% rise in Research revenue and a 2% increase in Learning revenue.
Adjusted EBITDA for both segments also showed positive trends, with Research maintaining a steady performance and Learning experiencing a significant 16% rise, reflecting the company's successful cost optimization efforts and revenue growth.
The company's GAAP results, however, painted a different picture, with a reported revenue decline of 6% largely due to a completed divestiture and declines in other held-for-sale businesses. Wiley also faced a GAAP operating loss of $46 million, which was an improvement of $21 million from the previous year, and a GAAP EPS loss of $2.08, compered to $1.29 from the prior year. These GAAP results were impacted by charges related to held-for-sale or sold assets.
Looking ahead, Wiley's management expressed confidence in the company's momentum and its ability to deliver a strong fourth quarter. Interim President and CEO Matthew Kissner commented on the company's recovery in Research and continued outperformance in Learning, which have allowed Wiley to raise its earnings guidance for the fiscal year. The company now expects adjusted EPS to be between $2.45 and $2.65, which is above the analyst consensus of $2.25.
Kissner's statement highlighted the decisive actions taken on improvement and optimization plans, which are anticipated to accelerate cost savings and drive material performance and profit improvement in Fiscal 2025 and 2026.
Investors will be watching closely as Wiley continues to navigate the challenges and opportunities ahead, with the company's raised guidance suggesting a promising outlook for the remainder of the fiscal year.
InvestingPro Insights
As John Wiley & Sons, Inc. (NYSE: WLY) showcases a solid third-quarter performance, real-time data from InvestingPro reinforces the narrative of a company on a recovery path. With a market capitalization of $1.82 billion, Wiley's investment profile is marked by a notable commitment to shareholder returns. This is evidenced by a high shareholder yield and a commendable track record of raising its dividend for 25 consecutive years, a streak that has now reached 29 years. Investors may find this particularly attractive, as consistent dividend payments often reflect a company's financial health and management's confidence in its future cash flows.
Despite a challenging GAAP operating loss, the InvestingPro Tips indicate that analysts are expecting a brighter future for Wiley. They predict that the company will not only be profitable this year but also anticipate net income growth. This aligns with management's optimistic outlook and raised earnings guidance for the fiscal year. However, it's important to note that analysts also foresee a sales decline in the current year, which could be a crucial factor for investors to monitor.
InvestingPro data also reveals a dividend yield of 4.23%, which is competitive in the current market and suggests a robust income-generating investment. Additionally, the company's P/E ratio stands at -15.87, but when adjusted for the last twelve months as of Q2 2024, it improves to 18.51. This forward-looking metric may indicate that the market is expecting better earnings in the near future.
For those considering an investment in Wiley, or seeking to deepen their analysis, InvestingPro offers a wealth of additional insights. There are currently 5 more InvestingPro Tips available, which can help investors make more informed decisions. To explore these tips and more, visit https://www.investing.com/pro/WLY and remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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