SLM

Dividend Predictability: Dividend amounts are unpredictable and fluctuate based on a company's profitability, with SLM Corp. serving as an example for assessing future dividend expectations.

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Executive Order to Dismantle Education Department: President Trump signed an executive order to dissolve the U.S. Department of Education, directing Secretary Linda McMahon to facilitate this process while acknowledging that full dissolution requires Congressional approval.

Transfer of Student Loan Servicing: The administration announced that federal student loan servicing will be transferred to the Small Business Administration, which is also planning to reduce its workforce by approximately 2,700 positions.

Trump's Executive Order: President Trump plans to sign an executive order to close the Department of Education, directing Secretary Linda McMahon to return education authority to the states while maintaining essential services.

Political Opposition: The move faces significant opposition from Democrats, who argue that public education is already managed at the state and local levels, and it would require bipartisan support in the Senate, which is currently unlikely.

Scholarship Opportunities: The Sallie Mae Fund, in collaboration with the Thurgood Marshall College Fund, is offering 40 scholarships of up to $10,000 each for high school seniors and 10 scholarships of up to $10,000 for graduate students, aimed at supporting those who demonstrate financial need and academic excellence.

Application Details: The application period for both scholarship programs is open until April 25, 2025, and interested students can apply through the Sallie Mae website.

ETF Analyst Target Price Insights: The SPDR Russell 1000 Yield Focus ETF (ONEY) has an implied analyst target price of $124.42, indicating a potential upside of 14.65% from its current trading price of $108.52.

Individual Stock Upside Potential: Notable underlying holdings such as Cullen/Frost Bankers, SLM Corp., and First Hawaiian Inc. show significant upside potential, with expected increases of 17.78%, 16.95%, and 16.40% respectively, compared to their recent share prices.

Department of Education Layoffs: The Department of Education plans to lay off nearly half of its workforce, reducing staff from 4,133 to about 2,183, as part of an effort to increase efficiency and accountability ahead of President Trump's anticipated executive order to abolish the agency.

Impact on Programs: Despite the layoffs, the department will continue to manage key programs such as student loans, Pell Grants, and funding for special needs students, although a complete shutdown of the agency would require congressional approval.

Analyst Ratings Changes: Top Wall Street analysts have adjusted their price targets and ratings for several companies, including Baxter International, Costco, SLM Corporation, and XPeng Inc, with some receiving upgrades while others faced downgrades.

Stock Performance Overview: The article highlights the closing prices of various stocks on Friday, noting significant changes in target prices and analyst recommendations, reflecting a mixed outlook across different sectors.

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Morgan Stanley's Price Target Increase: Morgan Stanley raised its price target for SLM from $32 to $38, maintaining an Overweight rating and highlighting the stock as a "Top Pick" due to anticipated growth in private student lending following potential federal loan caps.

Earnings Forecast Adjustment: The firm projects an increase of $3.5 billion in originations by 2026, leading to a 20% rise in its FY26 EPS forecast to $3.80, reflecting optimism about SLM's growth potential amid changing market conditions.

Trump's Proposal on Education Department: President Trump suggested that student loans might be transferred to the Treasury or agencies like the Small Business Administration as part of a plan to dismantle the Education Department, which would require congressional approval for full elimination.

Impact on Student Aid: The Education Department allocated approximately $121 billion in 2024 for federal grants and loans, supporting nearly 10 million students, indicating significant implications for student aid if the department is closed.

Trump's Executive Order Proposal: President Trump is considering an executive order to abolish the Department of Education, claiming that federal control over education has failed and directing the Education Secretary to facilitate its closure.

Impact and Challenges: Closing the department would require significant Senate support, and it manages crucial programs like Federal Student Aid, which oversees a large amount of student loans in the U.S.

Annual Meeting Announcement: Sallie Mae (SLM Corporation) will hold its 2025 annual meeting of stockholders virtually on June 17, 2025, at 1 p.m. ET, for stockholders recorded by April 21, 2025.

Company Mission: Sallie Mae emphasizes the importance of education and lifelong learning, providing private student lending and resources to support access to college and help customers achieve their goals.

CEO Appearance: Sallie Mae's CEO Jon Witter will speak at the 2025 RBC Capital Markets Global Financial Institutions Conference on March 4, 2025, at 9:20 a.m. ET, with a live audio webcast available for listeners.

Company Overview: Sallie Mae, a leader in private student lending, emphasizes the importance of education and lifelong learning, providing financing and resources to help individuals achieve their educational and personal goals.

SLM Corp Earnings Report: SLM Corp reported a fourth-quarter EPS of $0.50, missing analyst estimates, with net interest income also falling short. Analysts from Keefe, Bruyette & Woods, RBC Capital, and JP Morgan adjusted their price targets for the company following the report, reflecting mixed credit trends and expectations for future loan sales.

2025 Outlook: The company provided a 2025 EPS outlook of $3.00-$3.10, which is below the analyst estimate of $3.35. Despite higher provisions and lower net interest income, analysts noted potential for solid origination growth and manageable expenses moving forward.

ETF Performance Overview: On Friday, the highest volume ETF components included SLM, which rose by 1.4%, and Tetra Tech, which fell by 3.2%. HA Sustainable Infrastructure Capital showed the best performance with a 2.3% increase, while Hexcel declined by 4.2%.

Market Activity Insight: The article highlights unusual trading volumes in the Rockefeller US Small-Mid Cap ETF, indicating significant market activity for specific stocks.

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Financial Results Announcement: Sallie Mae has released its fourth-quarter and full-year 2024 financial results, which can be accessed on their investor website and the SEC's site.

Earnings Conference Call: An earnings conference call is scheduled for January 23, 2025, at 5:30 p.m. ET, where executives will discuss the company's performance and answer questions.

Earnings Report: SLM Corp. reported a fourth-quarter profit of $107.19 million, or $0.50 per share, down from $163.72 million, or $0.72 per share, in the previous year.

Analyst Expectations: The earnings fell short of analysts' expectations, which had predicted earnings of $0.55 per share.

Earnings Performance: Sallie Mae reported a Q4 GAAP EPS of $0.15, missing expectations by $0.40, while revenue was $390M, which is an 11.9% year-over-year decline but exceeded estimates by $19.12M.

Market Outlook: Morgan Stanley has upgraded ratings and price targets for consumer credit firms, including Sallie Mae, based on a positive outlook for 2025.

Major Earnings Reports: Key companies expected to report earnings after the market closes on Thursday include Texas Instruments, Intuitive Surgical, CSX Corporation, Columbia Banking System, and East West Bancorp.

Additional Earnings Releases: Other companies set to release their earnings after Thursday's close include CUBI and SLM.