Our opinion on the current state of STADIO(SDO)Stadio (SDO) is a tertiary education institution that offers a wide range of post-school training. The company provides higher education through five universities, offering qualifications ranging from higher certificates to degrees, master's, and PhD programs. Currently, it has over 46,000 students enrolled across six faculties, offering more than 50 accredited training programs. Notably, 86% of these students are studying online, aligning with the company's vision of growing its student base to 100,000, with a significant portion expected to be distance learning students.
In its results for the six months ending 30th June 2024, Stadio reported a 16% increase in revenue and a 20% rise in headline earnings per share (HEPS). The company's net asset value (NAV) also increased by 2% to 216c per share. The company noted, "The STADIO Group grew first semester students by 10% to 47,024 as at 30 June 2024 (30 June 2023: 42,874), with distance learning student numbers reflecting good overall growth of 10% to 40,702 at 30 June 2024 (30 June 2023: 37,067). Strong demand in professional qualifications continued to drive healthy growth in registrations for the period."
Given the challenges faced by government tertiary education in South Africa, Stadio is well-positioned to capitalize on the increasing demand for private education. The company has demonstrated strong growth and appears to be in a robust upward trend, making it a promising investment. We remain bullish on its prospects.