AFYA Overview

Earnings Performance: Afya (AFYA) reported quarterly earnings of $0.38 per share, exceeding the Zacks Consensus Estimate of $0.32, marking an 18.75% earnings surprise. The company has surpassed consensus EPS estimates three times in the last four quarters.

Revenue Insights: The company generated revenues of $170.44 million for the quarter, slightly missing the consensus estimate by 0.16%, but showing growth from $151.71 million a year ago. Afya has topped revenue estimates twice in the last four quarters.

Stock Outlook: Afya shares have declined by 9.1% year-to-date, underperforming the S&P 500's 16.4% gain. The stock currently holds a Zacks Rank #3 (Hold), indicating expected performance in line with the market.

Industry Context: The Schools industry, to which Afya belongs, is ranked in the bottom 32% of Zacks industries, suggesting potential challenges ahead. Investors are advised to monitor earnings estimate revisions and industry outlooks for future stock performance.

Financial Performance: Afya Limited reported a 10.4% year-over-year revenue increase in Q3 2025, reaching R$928.5 million, with a notable 14.6% rise in Adjusted EBITDA to R$398.9 million and a net income growth of 28.4% to R$159.4 million.

Operational Highlights: The company achieved a strong Adjusted EBITDA margin of 43.0%, driven by growth across its three segments: Undergraduate, Continuing Education, and Medical Practice Solutions, while maintaining a solid cash position of R$996.8 million.

Strategic Initiatives: Afya is focused on enhancing its ecosystem through AI-enabled solutions and expanding its medical school capacity, reaffirming its 2025 guidance for revenue between R$3.67 billion and R$3.77 billion.

Capital Management: The company successfully issued R$1.5 billion in commercial notes to strengthen its capital structure, repurchased shares, and reduced net debt significantly, reflecting a disciplined approach to capital allocation and liability management.

Increase in Medical Seats: Afya Limited has received authorization to increase medical seats at ITPAC Porto Nacional in Bragança, Pará, by 100, bringing the total to 150 seats on this campus.

Total Approved Seats: With this increase, Afya now has a total of 3,753 approved medical school seats across its institutions, highlighting its significant presence in Brazil's medical education sector.

Commitment to Quality Education: The expansion reflects Afya's commitment to providing quality medical education and its role as a leading medical education group in Brazil.

Comprehensive Ecosystem: Afya offers a physician-centric ecosystem that supports students and physicians throughout their careers, from medical school to residency preparation and continuing education.