MIDDLETOWN - EpicQuest Education Group International Limited (NASDAQ: EEIQ), a higher education provider, announced a new collaboration with Shanghai Jiao Tong University through its Davis University to establish a foundational program.
This program, designed to prepare students for Davis' bachelor's degree courses, is expected to generate at least $3.4 million annually starting in 2025.
The Cooperation Agreement, effective from May 8, 2024, through December 31, 2026, will see the launch of 'The Davis University Outstanding Innovation Talent Program' for the Fall 2024 semester. With an anticipated enrollment of 50 students per incoming class, tuition is set at $33,800 per student per year.
Jianbo Zhang, CEO of EpicQuest Education, expressed satisfaction with the partnership, emphasizing the program's role in guiding students towards completing their four-year degrees at Davis University. The program's revenue is considered an additional stream, separate from the company's North American institutions.
The foundational program's potential for revenue growth is based on the high retention rates and the expectation of at least 100 students enrolling annually starting in 2025.
The foundational program mirrors a similar initiative at Peking University, which has seen a significant increase in enrollment. Zhenyu Wu, CFO of EpicQuest Education, highlighted the high retention rates and the company's successful international student recruitment model.
EpicQuest Education's strategic growth plan includes international expansion and the establishment of EEIQ as a global higher education service provider. The company operates EduGlobal University in Canada and owns a majority stake in Davis University in Ohio. It also has partnerships with universities in the UK and provides additional educational and recreational services through its subsidiaries.
This announcement is based on a press release statement from EpicQuest Education Group International Limited.
InvestingPro Insights
As EpicQuest Education Group International Limited (NASDAQ: EEIQ) forges ahead with its new foundational program in collaboration with Shanghai Jiao Tong University, the company's financial health and stock performance offer valuable context for investors. According to InvestingPro data, EpicQuest Education has a market cap of $12.7 million and holds more cash than debt on its balance sheet, suggesting a stable financial footing for funding its strategic growth plans.
Despite a challenging environment with a negative revenue growth of -9.76% over the last twelve months as of Q4 2023, the company maintains impressive gross profit margins at 73.65%. This indicates a strong ability to control costs relative to revenue, which could be a key factor in the success of the new program. However, investors should note the company's significant operating income margin of -124.69%, reflecting the expenses incurred in its operations that exceed its gross profit.
An InvestingPro Tip highlights that management has been aggressively buying back shares, a move that often signals confidence in the company's future prospects. Additionally, analysts anticipate sales growth in the current year, which could align with the expected revenue from the foundational program starting in 2025.
For those interested in a deeper analysis, InvestingPro offers additional tips on EpicQuest Education Group International Limited, which can be explored at https://www.investing.com/pro/EEIQ. To access these insights, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. With 10 more InvestingPro Tips available, investors can gain a comprehensive understanding of EEIQ's position in the higher education industry.
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