Educational Development Corporation (EDUC) AI Stock Analysis
EDUC AI stock analysis summary
AI ResearchEducational Development Corporation is a trade co-publisher of educational children's books with a market cap of $8.9M. In FY2026, the company generated $21.8M in revenue and $3.3M in net income, though its 5-year revenue CAGR stands at -36.1%. Over the trailing twelve months, its operating margin was -38.4%, with quarterly revenue falling 11.9% in the period ended August 31, 2026.
- Market cap
- $8.9M
- Revenue (TTM)
- $20.0M
- P/E
- 5.2x fwd 19.6x
- 1Y return
- -28.8% S&P 500 16.8%
- Avg. target
- $5.00 380.8% vs last close
Bull case
- The company produced positive free cash flow of $1.5M in FY2026 alongside net income of $3.3M.
- Valuation multiples remain discounted relative to peers, with a price-to-sales ratio of 0.4x and EV/EBITDA of 2.1x compared to the median of its US-listed Communication Services peers at 0.8x and 10.0x.
- The analyst mean price target of $5.00 represents a 380.8% premium over the closing price of $1.04 on October 16, 2026.
Bear case
- Top-line sales have experienced multi-year contraction, dropping from $142.2M in FY2022 to $21.8M in FY2026 with a 5-year CAGR of -36.1%.
- Operating performance remains deeply negative on a trailing basis, evidenced by a trailing twelve-month operating margin of -38.4% and an ROA of -6.6%.
- Long-term share performance shows severe underperformance, with a 5-year return of -89.4% compared to an 83.0% gain for the S&P 500.
What Educational Development does
Educational Development Corporation operates as a trade co-publisher specializing in educational children's books across the United States. It functions through two main segments: Publishing and Usborne Books & More (UBAM). Its product catalog includes touchy-feely board books, activity books, flashcards, adventure tales, art books, sticker collections, foreign language titles, internet-linked books covering science, math, and literature, as well as chapter books and novels. Products are distributed through retail bookstores, school supply outlets, toy and gift shops, museums, trade wholesalers, tele-sales, and a direct sales network of independent consultants hosting home shows and book fairs.
Growth and profitability
Revenue has dropped substantially from $142.2M in FY2022 to $21.8M in FY2026, reflecting a 5-year revenue CAGR of -36.1%. Annual revenue fell 36.2% in FY2026, following declines of 33.0% in FY2025 and 41.9% in FY2024. Despite this contraction, net income returned to positive territory at $3.3M in FY2026 with an EPS of $0.27, up from net income of -$5.3M in FY2025. Gross margin was 62.4% in FY2026. For the trailing twelve months, revenue was $20.0M with an operating margin of -38.4%, while quarterly revenue declined 11.9% year-over-year in the quarter ended August 31, 2026.
Balance sheet and cash flow
As of August 31, 2026, the company held $1.1M in cash and short-term investments against total debt of $6.5M, resulting in net debt of $5.4M. Its debt-to-equity ratio stood at 0.16 and the current ratio was 3.27. In FY2026, Educational Development Corporation generated operating cash flow of $2.0M and free cash flow of $1.5M. Cash allocations during FY2026 included $542,800 for capital expenditures and $137,900 for share buybacks.
Valuation and performance
EDUC trades at a trailing P/E of 5.2x and a forward P/E of 19.6x, compared to medians of 16.2x and 14.1x for its US-listed Communication Services peers. Its price-to-sales multiple is 0.4x and EV/EBITDA is 2.1x, below the peer group medians of 0.8x and 10.0x, respectively. The stock closed at $1.04 on October 16, 2026, down 21.2% year-to-date and 28.8% over the past year. In comparison, the S&P 500 returned 16.8% over one year, while EDUC fell 89.4% over five years against an 83.0% gain for the benchmark.
What analysts expect
Wall Street analysts maintain a mean price target of $5.00 for EDUC, which stands 380.8% above the last closing price of $1.04. Over the last four quarters, the company recorded 1 EPS beat. Forward earnings estimates place the stock at a forward P/E of 19.6x.
Key risks and what to watch
- Quarterly revenue fell 11.9% year-over-year in the latest quarter ended August 31, 2026, indicating ongoing sales erosion.
- Available liquidity is limited, with cash and short-term investments of $1.1M against total debt of $6.5M as of August 31, 2026.
- The stock traded at $1.04 on October 16, 2026, near its 52-week low of $1.03 and 25.0% below its 200-day average.
AI-generated research summary. Written with AI from Quotelinks data as of October 16, 2026 and checked so every figure matches that data. For information only, not investment advice. Disclaimer
About this EDUC AI stock analysis
This page is an AI-written research summary of Educational Development Corporation (EDUC). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.
Related: EDUC income statement, EDUC balance sheet, EDUC key metrics, EDUC chart. See the EDUC stock overview for the latest quote and news.
EDUC AI stock analysis FAQ
What were EDUC's revenue and net income in FY2026?
In FY2026, Educational Development Corporation generated $21.8M in revenue, down 36.2% from the prior year. Net income was $3.3M, or $0.27 per share, improving from net income of -$5.3M in FY2025.
How much debt does Educational Development Corporation carry?
As of August 31, 2026, EDUC reported total debt of $6.5M and cash and short-term investments of $1.1M, giving it net debt of $5.4M. Its debt-to-equity ratio was 0.16.
What is the consensus analyst target for EDUC stock?
The mean analyst price target is $5.00, which is 380.8% above the stock's closing price of $1.04 on October 16, 2026.
How does EDUC's valuation compare to industry peers?
EDUC trades at a trailing P/E of 5.2x and an EV/EBITDA of 2.1x, below the US-listed Communication Services peer medians of 16.2x and 10.0x, respectively.