Nerdy Inc. (NRDY) announces break-even for the first quarter

Nerdy Inc. (NRDY) reported break-even quarterly earnings per share versus the Zacks Consensus Estimate of a loss of $0.05. This compares to a loss of $0.21 per share a year ago. These data are adjusted for one-off items.

This quarterly report is a 100% earnings surprise. A quarter ago, it was expected that this company would post a loss of $0.10 per share when it actually produced break-even earnings, which was a 100% surprise.

The company has topped consensus EPS estimates three times over the last four quarters.

Nerdy Inc., which belongs to the Zacks Schools industry, posted revenues of $49.18 million for the quarter ended March 2023, surpassing the Zacks Consensus Estimate by 5.86%. This compares with revenue of $46.93 million a year earlier. The company has topped consensus revenue estimates three times over the last four quarters.

The sustainability of the immediate share price movement based on the recently-released numbers and future earnings expectations will largely depend on management’s commentary on the earnings call.

Nerdy Inc. shares have gained about 29.3% since the beginning of the year, while the S&P 500 has gained 7.8%.

What’s next for Nerdy Inc.?

Although this year Nerdy Inc. performed better than the market, the question arises for investors: what’s next for the shares?

There are no easy answers to this key question, but one reliable indicator that can help investors address this is the company’s earnings outlook. This includes not only the current consensus earnings expectations for the coming quarter(s), but also how those expectations have changed recently.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings report, the estimate revision trend for Nerdy Inc. is trending. is mixed. While the magnitude and direction of estimate revisions could change following the company’s just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the stock is expected to perform in line with the market in the near future. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the coming days. The current consensus EPS estimate is -$0.03 on revenues of $46.55 million for the coming quarter and -$0.18 on revenues of $193.43 million for the current fiscal year.

Investors should be aware that the outlook for the industry may also have a significant impact on share prices. In terms of the Zacks Industry Rank, schools are currently in the top 32% of over 250 Zacks industries. Our research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Another company in the same sector, Afya (AFYA), has not yet released its results for the quarter ending March 2023.

The medical education company is expected to report quarterly earnings of $0.39 per share in its upcoming report, which would represent a year-over-year change of 14.7%. The consensus earnings per share estimate for the quarter remained unchanged over the past 30 days.

Afya’s revenue is expected to reach $135.56 million, up 25.1% compared to the same quarter last year.

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