Summary: BMO Capital Markets lifted its price target on Adtalem Global Education to $138 from $125 and maintained an Outperform rating following quarterly results that outpaced expectations. The upgrade reflects contribution from stronger performance at the Walden unit, a timing shift that benefited revenue and adjusted EBITDA, and management's raised guidance for fiscal 2026 adjusted earnings per share.
BMO's revised target aligns with analyst target data that range from $138 to $175, indicating that consensus views still consider ATGE undervalued even as the company holds a strong financial health rating. The research house increased its estimates and the price objective after management raised full-year adjusted EPS guidance for fiscal 2026.
Adtalem posted robust top-line and bottom-line results for the second quarter of fiscal 2026. Adjusted earnings per share came in at $2.43, above the $2.19 analysts had expected. Revenue for the quarter reached $503.4 million, beating the projected $490.75 million. These outcomes underscore the company's ability to exceed expectations in the period.
The company's performance over the trailing twelve months shows 11.9% revenue growth, and EBITDA reached $428.9 million. Those metrics factor into BMO's reassessment of the company's near-term outlook and valuation.
BMO highlighted a timing shift at Walden that moved one week of activity from Adtalem's fiscal third quarter of 2026 into the second quarter, effectively adding $18 million to both revenue and adjusted EBITDA for the quarter. Even after accounting for that timing change, results still surpassed expectations, the firm noted.
At Chamberlain, management reported improvements in marketing efficiency and in the conversion rates within the enrollment funnel. Company leaders expressed optimism that these operational changes could support enrollment growth resuming in fall 2026, though Chamberlain's recovery remained a partial offset to Walden's stronger performance in the reported quarter.
Following the quarterly release and the guidance raise, BMO updated its model assumptions and raised its price target to $138 while keeping an Outperform rating on the shares. Despite the favorable earnings and revenue surprise, Adtalem's stock experienced a modest decline in after-hours trading.
Investors and market participants will likely watch how enrollment trends at Chamberlain evolve and whether the timing effects at Walden are one-off or indicative of sustainable momentum. For now, the quarter and the guidance change prompted an upward revision from a key equity research shop, reinforcing a more positive near-term view among analysts.
Financial snapshot (reported):
- Second-quarter adjusted EPS: $2.43 (vs. $2.19 expected)
- Quarterly revenue: $503.4 million (vs. $490.75 million expected)
- Trailing 12-month revenue growth: 11.9%
- Reported EBITDA: $428.9 million
- Walden timing benefit: $18 million added to revenue and adjusted EBITDA