Scholastic Corporation (SCHL)
NASDAQConsumer DiscretionaryPublishingSnapshot 2026-09-09
$35.58-1.98%
Close 2026-09-09 · 1-day change
NASDAQConsumer DiscretionaryPublishingSnapshot 2026-09-09
Broken: Primary pillar broken — Free cash flow at or above $430 million in fiscal 2026: FCF $35M-$40M vs 430M.
Scholastic plans to return $200 million to shareholders via buybacks. Free cash flow is guided at $430 million for fiscal 2026. Analysts expect about 5% revenue growth next year. The company is profitable with stable management.
The stock trades at a high PE of 58.8, well above peers at 17.3. Consensus EPS for the current quarter is negative. Revenue growth forecasts have been revised down recently. The sector faces headwinds and company momentum has weakened.
The market prices in about 5% revenue growth and stretched growth over 3-5 years. Our fair value near $26 aligns with consensus, but the high valuation risks downside if growth disappoints.
Breaks if: EPS falls below $2.67 in fiscal 2027
Breaks if: Free cash flow falls below $430 million in fiscal 2026
Breaks if: Revenue growth falls below 4.9% next year
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a turnaround story with a focus on long-term growth and margin expansion. The current thesis state is mixed, as the company faces challenges in its Education segment while also pursuing shareholder value through buybacks.
The market currently reflects a neutral valuation, with expectations closely aligned to the company's recent performance. There is a low expectations gap, indicating that investors are not overly optimistic or pessimistic about future growth.
Fundamentals are expected to show mixed results in the near term. While the company has reported some margin expansion, revenue pressures in the Education segment may continue to challenge overall performance.
The thesis hinges on several key factors, including management's ability to deliver on growth and margin expansion, sector performance from major players, and the potential impact of inflation on consumer discretionary spending.
The most important moves since the prior daily snapshot.
Yes, our read has weakened. The latest earnings beat provided some support for the thesis. However, a sharp drop in the stock price may indicate a repricing of the thesis. This suggests that the market is reassessing the reasons to own SCHL.
as of 2026-09-09
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: Buyback program is delayed or canceled
Over the next 1 to 3 years, SCHL's performance will depend on effective execution of its growth strategies and external economic conditions. Not investment advice.