ARCO PLATFORM Reports 14.3% YOY Revenue Increase of BRL 471 Million for Q2 FY2023
September 3, 2023
☀️Earnings Overview
For the second quarter of fiscal year 2023, ARCO PLATFORM ($NASDAQ:ARCE) reported total revenue of BRL 471.0 million, a 14.3% increase from the same period in the previous year. The earnings were officially revealed on August 31 2023.
Analysis
GoodWhale has conducted an in-depth analysis of ARCO PLATFORM‘s fundamentals and found that the company has an intermediate health score of 4/10 with regard to its cashflows and debt, indicating that it might be able to pay off debt and fund future operations. ARCO PLATFORM is strong in terms of growth, rated as medium in regards to profitability, and weak in terms of assets and dividends. This assessment has enabled GoodWhale to classify ARCO PLATFORM as a ‘cheetah’, a type of company that achieved high revenue or earnings growth but is considered less stable due to lower profitability. Given such an assessment, there are certain types of investors who may find ARCO PLATFORM to be an attractive option. Specifically, investors who prioritize growth over stability will be drawn to ARCO PLATFORM’s strong growth potential, while those seeking higher returns may be willing to take on the associated risks of investing in a cheetah company. In addition, investors who are looking for short-term gains may be encouraged by ARCO PLATFORM’s current cash flow and debt situation, which could enable them to turn a quick profit. Ultimately, ARCO PLATFORM may be an attractive option for investors willing to take on the risk associated with cheetah companies. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Arco Platform. More…
| Total Revenues | Net Income | Net Margin |
| 1.94k | -33.24 | -18.7% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Arco Platform. More…
| Operations | Investing | Financing |
| -39.73 | 254.73 | -188.83 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Arco Platform. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 6.44k | 3.71k | 41.26 |
Key Ratios Snapshot
Some of the financial key ratios for Arco Platform are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 33.5% | 14.4% | 11.3% |
| FCF Margin | ROE | ROA |
| -10.0% | 5.0% | 2.1% |
Peers
In recent years, Arco Platform Ltd has faced stiff competition from Vasta Platform Ltd, Lingo Media Corp, and SINO Tactful Co Ltd. All three companies are vying for a share of the online education market, and each has its own unique strengths and weaknesses. Arco Platform Ltd has managed to stay ahead of its competitors by offering a more comprehensive and user-friendly platform.
– Vasta Platform Ltd ($NASDAQ:VSTA)
Vasta Platform Ltd is a publicly traded company with a market capitalization of 315.55 million as of 2022. The company has a return on equity of 1.19%. Vasta Platform Ltd is a provider of enterprise software solutions. The company’s software offerings include enterprise resource planning (ERP), customer relationship management (CRM), and supply chain management (SCM) solutions.
– Lingo Media Corp ($TSXV:LM)
SINO Tactful Co Ltd is a Chinese company that specializes in the production of construction materials. The company has a market capitalization of 830.04 million as of 2022 and a return on equity of -0.57%. The company’s products are used in a variety of applications, including the construction of bridges, roads, and buildings.
Summary
Investors considering ARCO PLATFORM should be encouraged by the company’s performance in the second quarter of FY2023, with total revenue increasing 14.3% year-over-year from BRL 471 million. Despite suffering a net loss of BRL -74 million, it was an improvement from -13.3 million in the year prior. ARCO PLATFORM’s strong revenue growth suggests the company is well-positioned to continue growing into the future. Investors should consider the potential of this stock as part of their portfolio.
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