EpicQuest Education Group International Ltd (NASDAQ: EEIQ)

Sector: Consumer Defensive Industry: Education & Training Services CIK: 0001781397
Market Cap 3.38 Mn
P/B 0.38
P/E -1.39
P/S 0.38
ROIC (Qtr) 0.00
Div Yield % 0.00
Rev 1y % (Qtr) 0.00
Total Debt (Qtr) 2.74 Mn
Debt/Equity (Qtr) 0.31
Add ratio to table...

About

EpicQuest Education Group International Ltd, known by its ticker symbol EEIQ, operates in the education sector, specifically providing services to Chinese students seeking to study abroad in the United States. The company, registered and incorporated in the British Virgin Islands in December 2017, has a diverse range of subsidiaries that facilitate various aspects of study abroad and post-study services. EpicQuest's primary business activities revolve around education services, including study abroad and post-study services. The company's subsidiaries...

Read more

Investment thesis

Bull case

  • Healthy cash reserves of 5.09M provide 6.77x coverage of short-term debt 752429, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of (2.95M) provides exceptional 30.22x coverage of minority interest expenses (97492), showing strong core operations.
  • Strong tangible asset base of 18.88M provides 6.88x coverage of total debt 2.74M, indicating robust asset backing and low credit risk.
  • Cash reserves of 5.09M exceed inventory value of 46381 by 109.81x, indicating strong liquidity and inventory management.
  • Cash reserves of 5.09M provide comfortable 10.68x coverage of tax obligations 477016, showing strong fiscal management.

Bear case

  • Operating cash flow of (2.95M) barely covers its investment activities of 1.46M, with a coverage ratio of -2.02, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of (2.95M) provides insufficient coverage of deferred revenue obligations of 6.04M, which is -0.49x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of (2.95M) shows concerning coverage of stock compensation expenses of 972879, with a -3.03 ratio indicating potential earnings quality issues.
  • High receivables of 2.62M relative to inventory of 46381 (56.58 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Operating cash flow of (2.95M) provides minimal -870.66x coverage of tax expenses of 3384, suggesting potential tax planning inefficiencies or unsustainable tax positions.

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 0.22 0.71
EV to Cash from Ops. EV/CFO -1.92 6.80
EV to Debt EV to Debt 2.06 11.15
EV to EBIT EV/EBIT -2.33 112.78
EV to EBITDA EV/EBITDA -1.50 6.48
EV to Free Cash Flow [EV/FCF] EV/FCF -3.79 5.57
EV to Market Cap EV to Market Cap 1.67 582,173.64
EV to Revenue EV/Rev 0.63 1.74
Price to Book Value [P/B] P/B 0.38 -3.80
Price to Earnings [P/E] P/E -1.39 -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 0.00 53.05
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex Growth (1y) % 103.03 -82.12
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 242.11 25.11
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.54
EBIAT Growth (1y) % EBIAT Growth (1y) % 59.45 -39.04
EBITDA Growth (1y) % EBITDA Growth (1y) % 46.14 -34.79
EBIT Growth (1y) % EBIT Growth (1y) % 61.65 -40.70
EBT Growth (1y) % EBT Growth (1y) % 61.65 -52.53
EPS Growth (1y) % EPS Growth (1y) % 65.87 -29.51
FCF Growth (1y) % FCF Growth (1y) % 82.99 -36.51
Gross Profit Growth (1y) % Gross Profit Growth (1y) % 11.53 -3.42
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Utilization Ratio 0.35 0.63
Cash Payout Ratio Cash Payout Ratio 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.57 0.73
Current Ratio Curr Ratio (Qtr) 1.83 1.63
Debt to Equity Ratio Debt/Equity (Qtr) 0.31 3.83
Interest Cover Ratio Interest Cover Ratio 0.00 53.05
Times Interest Earned Times Interest Earned 0.00 53.05
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % -22.50 -30.62
EBIT Margin % EBIT Margin % -27.13 -82.13
EBT Margin % EBT Margin % -27.13 -47.07
Gross Margin % Gross Margin % 66.30 50.48
Net Profit Margin % Net Profit Margin % -27.20 -48.61