Grand Canyon Education Inc.
Grand Canyon Education, Inc. is a leading provider of education services in the U.S. It supports colleges and universities with technology, curriculum, and operational solutions.
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Performance
For the year ended December 31, 2024, Grand Canyon Education, Inc. reported a 7.5% increase in service revenue to $1.03 billion, driven by higher enrollments, particularly in GCU’s online programs and at off-campus healthcare-focused sites. Net income rose 10.4% to $226.2 million. Expense categories—technology and academic services, counseling, marketing, and general administration—all saw modest increases aligned with enrollment growth and site expansions, though costs as a percentage of revenue generally declined or remained flat, reflecting operational leverage. The company continued investing in partner programs and infrastructure while managing faculty reimbursement changes and adapting to shifting enrollment trends. Seasonal fluctuations in enrollment patterns affected quarterly performance, with stronger results typically in Q1 and Q4. The Grand Canyon Education, Inc. has a price-to-earnings (PE) ratio of 23, indicating a moderate valuation relative to its earnings. Although it does not currently offer a dividend yield, it demonstrates strong profitability, with a return on assets (ROA) of 18% and an impressive return on equity (ROE) of 30%, reflecting efficient use of both assets and shareholder capital. Insider selling activity. As of January 29, 2025, Grand Canyon Education’s Board increased its share repurchase authorization by $200 million, bringing total authorized repurchases to $2.245 billion through March 1, 2026. Since 2011, the company has repurchased 23.9 million shares for $1.945 billion, including 1.14 million shares for $165.4 million in 2024. Repurchases are made at the company’s discretion, depending on market and business conditions. The company does not anticipate paying any cash dividends.
Quality of Earnings
The company demonstrates adherence to General Accounting Principles, with financial reports that conform to GAAP, are decision-useful, sustainable, and offer returns exceeding the cost of capital. There have been no recent changes to accounting policies. Revenue remains robust over a course of several years. Additionally, there are no significant financial report warning signs: earnings contain minimal accrual components, do not narrowly beat benchmarks in a suspicious pattern, and revenue is not recognized prematurely. Operating cash flows align with net income, earnings are recurring and persistent, and there is no history of restatements or enforcement actions, reinforcing the reliability and quality of the company’s financial reporting. The GCE earns a large percentage of their revenue through the contractual relationship as a service provider to GCU, and a decline in GCU’s enrollment could significantly reduce their revenue and impact the overall financial performance. The critical audit matter identified was the evaluation of the sufficiency of audit evidence over service revenue, which totaled $1,033 million for the year ended December 31, 2024. This matter involved complex and subjective auditor judgment due to the Company’s reliance on varying tuition and fee information from its University Partners to determine service revenue. Auditors assessed internal controls related to revenue recognition, reviewed contracts and enrollment documentation, and evaluated the nature and sufficiency of the audit evidence obtained to ensure the accuracy of revenue recorded.Quality of revenue can be self checked with this questionnaire:
Conclusions were based on an annual report:
Company Summary
Grand Canyon Education, Inc. (GCE), a Delaware-based publicly traded education services company, provides large-scale support to colleges and universities through advanced technology, infrastructure, and operations. Its primary partner is Grand Canyon University (GCU), a nonprofit institution in Arizona with over 123,100 students enrolled across online and on-campus programs. As of December 31, 2024, GCE served around 127,150 students and supported 22 university partners nationwide. The company also collaborates with universities and healthcare networks to offer healthcare-related academic programs near medical facilities, producing career-ready graduates. GCE aims to grow by adding new partners and expanding programs with existing ones, especially in healthcare and online education.
