Skillful Craftsman Education Technology Ltd (NASDAQ: EDTK)

Sector: Consumer Defensive Industry: Education & Training Services CIK: 0001782309
Market Cap 14.03 Mn
P/B 1.09
P/E -2.49
P/S 18.12
ROIC (Qtr) 0.00
Div Yield % 0.00
Rev 1y % (Qtr) 0.00
Total Debt (Qtr) 1.05 Mn
Debt/Equity (Qtr) 0.08
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About

Investment thesis

Bull case

  • Operating cash flow of (4.38M) provides exceptional 11.92x coverage of interest expenses (367385), showing strong debt service capability.
  • Strong tangible asset base of 14.95M provides 14.22x coverage of total debt 1.05M, indicating robust asset backing and low credit risk.
  • Free cash flow of (4.38M) provides exceptional 11.92x coverage of interest expense (367385), showing strong debt service ability.
  • Tangible assets of 14.95M provide robust 14.27x coverage of other current liabilities 1.05M, indicating strong asset backing.
  • Cash reserves of 567533 provide comfortable 2.66x coverage of tax obligations 213555, showing strong fiscal management.

Bear case

  • Operating earnings of (5.96M) show weak coverage of depreciation charges of 167498, with a -35.58 ratio indicating high capital intensity and potential reinvestment needs.
  • Operating cash flow of (4.38M) provides minimal -82.56x coverage of tax expenses of 53048, suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Long-term investments of 14.19M represent a high 182.96x of fixed assets 77546, indicating potential overexposure to financial assets versus operational capabilities.
  • Free cash flow of (4.38M) represents just -4.87x of debt issuance 900000, suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of (4.38M) barely covers operating expenses of 658269 with a -6.65 ratio, suggesting thin operational efficiency margins and limited flexibility.

Peer comparison

Companies in the Education & Training Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 EDU New Oriental Education & Technology Group Inc. 9.35 Bn 24.58 1.82 0.78 Bn
2 TAL TAL Education Group 6.18 Bn 22.22 2.20 0.38 Bn
3 GHC Graham Holdings Co 5.47 Bn 12.27 1.91 1.17 Bn
4 LAUR Laureate Education, Inc. 5.20 Bn 25.55 3.29 0.44 Bn
5 LOPE Grand Canyon Education, Inc. 4.62 Bn 21.85 4.23 0.11 Bn
6 LRN Stride, Inc. 3.61 Bn 11.32 1.43 0.56 Bn
7 ATGE Covista Inc. 3.46 Bn 13.66 1.83 0.73 Bn
8 PRDO PERDOCEO EDUCATION Corp 2.84 Bn 42.39 1.73 0.06 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.90 0.71
EV to Cash from Ops. EV/CFO -3.09 6.80
EV to Debt EV to Debt 12.86 11.15
EV to EBIT EV/EBIT -2.27 112.78
EV to EBITDA EV/EBITDA -16.33 6.48
EV to Free Cash Flow [EV/FCF] EV/FCF -3.09 5.57
EV to Market Cap EV to Market Cap 0.96 582,173.64
EV to Revenue EV/Rev 17.45 1.74
Price to Book Value [P/B] P/B 1.09 -3.80
Price to Earnings [P/E] P/E -2.49 -1.70
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 11.73
Dividend Payout Ratio % Dividend Payout Ratio % 0.00 2.21
Dividend per Basic Share Div per Share (Qtr) 0.00 0.25
FCF Dividend Payout Ratio % FCF Dividend Payout Ratio % 0.00 1.69
Interest Coverage Interest Coverage 16.22 53.05
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex Growth (1y) % 0.00 -82.12
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -96.75 25.11
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.54
EBIAT Growth (1y) % EBIAT Growth (1y) % 21.73 -39.04
EBITDA Growth (1y) % EBITDA Growth (1y) % 88.07 -34.79
EBIT Growth (1y) % EBIT Growth (1y) % 22.72 -40.70
EBT Growth (1y) % EBT Growth (1y) % 23.54 -52.53
EPS Growth (1y) % EPS Growth (1y) % 27.08 -29.51
FCF Growth (1y) % FCF Growth (1y) % -61.90 -36.51
Gross Profit Growth (1y) % Gross Profit Growth (1y) % 288.92 -3.42
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Utilization Ratio 0.05 0.63
Cash Payout Ratio Cash Payout Ratio 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.27 0.73
Current Ratio Curr Ratio (Qtr) 0.33 1.63
Debt to Equity Ratio Debt/Equity (Qtr) 0.08 3.83
Interest Cover Ratio Interest Cover Ratio 16.22 53.05
Times Interest Earned Times Interest Earned 16.22 53.05
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % -747.70 -30.62
EBIT Margin % EBIT Margin % -769.37 -82.13
EBT Margin % EBT Margin % -721.94 -47.07
Gross Margin % Gross Margin % 169.50 50.48
Net Profit Margin % Net Profit Margin % -728.80 -48.61