Universal Technical Institute Inc (NYSE: UTI)

Sector: Consumer Defensive Industry: Education & Training Services CIK: 0001261654
Market Cap 1.68 Bn
P/B 5.01
P/E 31.37
P/S 1.97
ROIC (Qtr) 9.20
Div Yield % 0.00
Rev 1y % (Qtr) 9.64
Total Debt (Qtr) 289.57 Mn
Debt/Equity (Qtr) 0.86
Add ratio to table...

About

Universal Technical Institute, Inc. (UTI) is a prominent player in the workforce solutions industry, specializing in education programs for transportation, skilled trades, and healthcare. The company, which was established in 1965, operates under various brands such as Universal Technical Institute, Motorcycle Mechanics Institute, Marine Mechanics Institute, NASCAR Technical Institute, and MIAT College of Technology. UTI's business strategy revolves around the principle of "If you succeed, we succeed," with a focus on deepening its presence in existing...

Read more

Investment thesis

Bull case

  • Healthy cash reserves of 97.47M provide 4.54x coverage of short-term debt 21.49M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 784.48M provides 2.71x coverage of total debt 289.57M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 77.45M provides exceptional 15.71x coverage of interest expenses 4.93M, showing strong debt service capability.
  • Tangible assets of 784.48M provide exceptional 8.86x coverage of deferred revenue 88.58M, showing strong service capability backing.
  • Robust tangible asset base of 784.48M provides 25.48x coverage of working capital 30.79M, indicating strong operational backing.

Bear case

  • Operating cash flow of 77.45M barely covers its investment activities of (131.09M), with a coverage ratio of -0.59, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 77.45M provides insufficient coverage of deferred revenue obligations of 88.58M, which is 0.87x, raising concerns about future service delivery capabilities.
  • Free cash flow of 16.58M provides weak coverage of capital expenditures of 60.88M, with a 0.27 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 77.89M show weak coverage of depreciation charges of 58.47M, with a 1.33 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 16.58M represents just -0.88x of debt issuance (18.74M), suggesting concerning reliance on leverage rather than internal cash generation for growth.

Segments Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

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 2.19 0.71
EV to Cash from Ops. EV/CFO 23.62 6.80
EV to Debt EV to Debt 6.32 11.15
EV to EBIT EV/EBIT 23.49 112.78
EV to EBITDA EV/EBITDA 14.06 6.48
EV to Free Cash Flow [EV/FCF] EV/FCF 110.35 5.57
EV to Market Cap EV to Market Cap 1.09 582,173.64
EV to Revenue EV/Rev 2.14 1.74
Price to Book Value [P/B] P/B 5.01 -3.80
Price to Earnings [P/E] P/E 31.37 -1.70
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 11.73
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 2.21
Dividend per Basic Share Div per Share (Qtr) 0.00 0.25
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 1.69
Interest Coverage Int. cover (Qtr) 15.80 53.05
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -155.83 -82.12
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -45.17 25.11
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 0.54
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -4.62 -39.04
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 4.62 -34.79
EBIT Growth (1y) % EBIT 1y % (Qtr) -0.76 -40.70
EBT Growth (1y) % EBT 1y % (Qtr) 3.91 -52.53
EPS Growth (1y) % EPS 1y % (Qtr) -1.98 -29.51
FCF Growth (1y) % FCF 1y % (Qtr) -77.67 -36.51
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 15.54 -3.42
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.03 0.63
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.45 0.73
Current Ratio Curr Ratio (Qtr) 1.14 1.63
Debt to Equity Ratio Debt/Equity (Qtr) 0.86 3.83
Interest Cover Ratio Int Coverage (Qtr) 15.80 53.05
Times Interest Earned Times Interest Earned (Qtr) 15.80 53.05
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 15.90 -30.62
EBIT Margin % EBIT Margin % (Qtr) 9.11 -82.13
EBT Margin % EBT Margin % (Qtr) 8.53 -47.07
Gross Margin % Gross Margin % (Qtr) 49.60 50.48
Net Profit Margin % Net Margin % (Qtr) 6.30 -48.61