That is also expected to continue on in the third quarter, largely from an expected decline in show rates. The schools operated by Concorde Career Colleges are accredited by either the Accrediting Commission of Career Schools and Colleges (ACCSC) or the Council on Occupational Education (COE). For the first half growth came in at 17 percent. One of the major problems UTI has faced for some time has been the conversion of inquiries into applications. See our latest analysis for Universal Technical Institute. That implies potential students don't see the costs of going to UTI as commensurate with the benefits. A more reasonable scenario of6% NOPAT growth for 10 yearsyields a fair value of just $3.75/share 60% downside. 1) UTI is an educational institution and cannot guarantee employment or salary. More than anything that's the challenge faced by UTI, and until it's able to turn that sentiment around it will continue to lose students. Together in the three student segments, applications dropped 9 percent in the quarter, and is down 6 percent year-over-year. I wrote this article myself, and it expresses my own opinions. This poor strategy used and destroyed capital that could have been put to work attracting new students to UTI and retooling its business. "We take the responsibility of becoming one of this country's leading workforce solutions providers seriously, and entering the healthcare space allows us to help even more students and support employers as they seek to solve some of their toughest workforce-related challenges. UTI welcomes General Education Diploma students. "Universal Technical Institute's brands have a great reputation with both employers and students in transportation and skilled trades. In response, UTI has increased its scholarship opportunities to attract new students but it has also been forced to raise tuition to prevent revenues from falling in the face of declining enrollment. 1) UTI is an educational institution and cannot guarantee employment or salary. Of course, keep in mind that there are other factors to consider, too. Access your no-cost report to get info on jobs in demand in your area, industry insight from top employers, and more. Under some state laws, this data Concorde's revenue and adjusted EBITDA for calendar 2021 were approximately $180 million and $13 million, respectively. Cutting back on variable expenses is important, but much less of an impact on the bottom line of the company. Choose from a range of programs you need to get the technical career you want. To address the needs of industry and corporate clients, UTI started providing continuing education and training for technicians in 1980. UTI has struggled in recent years. In 1988 UTI opened their Lisle, Illinois, campus. Examples of forward-looking statements include, among others, statements regarding (1) UTI's belief that the acquisition will serve as a cornerstone for its key future growth and diversification efforts; (2) UTI's ability to integrate Concorde's healthcare programs into its portfolio of educational offerings; (3) UTI's anticipated expansion efforts; (4) UTI's expectation of increasing shareholder value; and (5) UTI's expectation of accelerating its revenue, profitability and cash flow over the next several years. This should lead to better outcomes for students, which will increase the value of the courses offered and decrease price and debt resistance. Finally concerning the strategy of the company is an adjustment in its fee structure and a boost in scholarships. This rate excludes graduates not available for employment because of continuing education, military service, health, incarceration, death or international student status. Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. Student-Paid vs. Manufacturer-Paid Programs, Table 1.10 Occupational separations and openings, projected 2021-31, Table 1.2 Employment by detailed occupation, 2021 and projected 2031. 2023 Universal Technical Institute, Inc. All rights reserved. Upon completion of the Concorde acquisition, the company will serve over 20,000 students across 14 states and 312locations. In the first half of the fiscal year EBITDA was $16.3 million against $23.5 million in the first half of 2012. The current price of the stock implies the company will generate outsized profit growth far beyond what I think is likely to occur. UTI has stated in its most recent conference call that it expects enrollment to continue to decline for the next several quarters, and this decline may accelerate if the tuition increases remain. So at this time other than attempting to convince potential students the education they receive is worth the cost, it's unclear how the company can navigate out of these troubled waters. For those that are open to it, it is difficult for many to obtain the student financing needed to go to school. For more information, visit www.uti.edu, or follow on LinkedIn @UniversalTechnicalInstitute and on Twitter @news_UTI. Contact an Admissions Representative to begin the enrollment process. Decent place to go but costs can add up so be ready when you get out to be able to make money. Figure 1 shows that average enrollment at UTI colleges peaked in 2010 and has been on the decline since. Universal Technical Institute, Inc. (NYSE: UTI), a leading workforce solutions provider of transportation and skilled trades education programs, today announced the close of its acquisition of . Since the items excluded from these measures are significant components in understanding and assessing financial performance under GAAP, these measures should not be considered to be an alternative to net income (loss) or any other measures derived in accordance with GAAP as a measure of operating performance or profitability. Want Technical Training? The fall in revenue was directly tied to the decline in students attending the school. UTI has relationships with manufacturers of more than 35 leading brands. The schools operated by Concorde Career Colleges are accredited by either the Accrediting Commission of Career Schools and Colleges (ACCSC) or the Council on Occupational Education (COE). Over the last 12 months (TTM) the gross margin is 48.5 percent, operating margin is 3.6 percent, and net margin is 2.0 percent. If they do, the company may get a bump up in share price because of low expectations. Note that UTI scores second lowest in profit margins, profit growth, and is the most highly valued company on the list. Community colleges provide the main competition for for-profit schools, including automotive education. For more information, visit www.uti.eduor www.concorde.edu, or visit us on LinkedIn at @Universal Technical Institute and @Concorde Career Colleges or on Twitter @news_UTI or @ConcordeCareer. These schools, along with UTI rank at the bottom of the list in every metric. 14) Incentive programs and employee eligibility are at the discretion of the employer and available at select locations. Rated 1.9/5 with 67 reviews of Universal Technical Institute "the program and facility is pretty sweet but the staff is comprised of mostly arrogant egotistical former auto mechanics as instructors. UTI expressly disclaims any obligation to publicly update any forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments, changes in expectations, any changes in events, conditions, or circumstances, or otherwise. Lincoln Education and Corinthian colleges are the other schools on the list with automotive technology programs. UTI settled out of court with the employee. You can exercise your right to opt The acquisition adds campuses in Texas and Michigan and eight new . Therefore, you should not rely on any of these forward-looking statements. I understand that my consent is not required to apply, enroll or make any purchase. For further details on how we use your data, please review UTI's Privacy Policy. I generally consider insider ownership to be a good thing. You may opt-out of receiving targeted advertisements from other companies that perform interest-based advertising services, including some that we may work with, via the Digital Advertising Alliance (DAA) site at http://optout.aboutads.info. But to understand Universal Technical Institute better, we need to consider many other factors. 1) UTI cannot guarantee employment or salary. Sam McBride and Andr Rouillard contributed to this report. Keeping things as they are won't cut it. Bulls focus on UTI's assets and clean balance sheet but overlook the company's. That level of sustained growth seems unlikely given the many problems facing UTIs industry. Grant to Succeed Kimberly J. McWaters as Chief Executive Officer", "Universal Technical Institute Completes Acquisition of MIAT College of Technology", https://www.bizjournals.com/phoenix/news/2021/11/05/phoenix-school-back-in-growth-mode.html, "Universal Technical Institute Will Add 15 New Programs in Transportation and Skilled Trades Across Its National UTI/MIAT Campus Footprint", "UTI Adding New Automotive, Skilled Trade Programs | THE SHOP", "Universal Technical Institute Expands Platform of Workforce Solutions Offerings with Completion of Concorde Career Colleges, Inc. Acquisition", "Universal Technical Institute, Inc. to Acquire Concorde Career Colleges, Inc., a Leading Provider of Healthcare Education Programs", "Universal Technical Institute plans $50M acquisition of Concorde Career Colleges", "Ford to collaborate with Universal Technical Institute on EV training curriculum", "Universal Technical Institute Selects Bosch to Develop New Courseware Supporting its Electric Vehicle Training Strategy", https://www.bizjournals.com/phoenix/news/2018/02/08/uti-stock-up-while-stemming-losses-as-enrollment.html, "Universal Technical Institute Celebrates Opening of Austin Campus", "Universal Technical Institute Selects Miami Metropolitan Area As The Location For The Second New Campus It Plans To Open In 2022", https://en.wikipedia.org/w/index.php?title=Universal_Technical_Institute&oldid=1133240788, This page was last edited on 12 January 2023, at 21:12. Management understands what must be done, but the overwhelming negative trend in the market will be hard to overcome no matter what changes are made. UTI cannot guarantee employment or salary. Therefore, you should not rely on any of these forward-looking statements. We have 9 programs at 13 locations. On Nov. 1, 2021, UTI announced it had completed the acquisition of MIAT College of Technology,[11][12] On June 9, 2022, the company announced plans to add 15 new programs across its national UTI/MIAT campus footprint. UTI is an educational institution and cannot guarantee employment or salary. The ongoing high fixed costs, which can't be managed, is what makes UTI such a risk to own if investors want any type of growth. Once males leave high school, specifically in the 18-24 demographic, it becomes harder to reach them. These forward-looking statements which address Universal Technical Institute, Inc.'s ("UTI") expected future business and financial performance may contain words such as "goal," "target," "future," "estimate," "expect," "anticipate," "intend," "plan," "believe," "seek," "project," "may," "should," "will," the negative form of these expressions or similar expressions. UTI's default rate, however, was relatively low for a for-profit college, fluctuating from 12% to 16%. 1.7 million+ Total technician employment expected nationally by 203138 Concorde Career Colleges has a strong reputation in healthcare education, making this an excellent combination for addressing the nation's skills gap," said Concorde CEO Jami Frazier. This may not be consistent with full year annual report figures. With 7.0% and 6.0% of the shares outstanding respectively, 22NW, LP and BlackRock, Inc. are the second and third largest shareholders. See some of the exciting things our graduates are doing today. Positions Universal Technical Institute to Seize Opportunity in High-Growth, High-Demand Healthcare Education Market, Significantly Accelerates Ongoing Growth and Diversification Efforts in Conjunction with Existing Initiatives to Meet Increasing Demand from Employers and Students, Universal Technical Institute and Concorde Career Colleges Together Now Serve 20,000+ Students Across 14 States and 33Locations with Significant Opportunitiesto Expand to Meet Varied Workforce-Training Needs, Concorde CEO Jami Frazier Joins the Universal Technical Institute Senior Leadership Team as President of the Healthcare Division. 7) Some programs may require longer than one year to complete. We expect the transaction to close during the first half of fiscal 2023, subject to regulatory approvals and other customary closing conditions.". At the time of its initial public offering, UTI carried a debt load of $57.3 million. Approximately 250,000 students have graduated from one of Universal Technical Institute's 14 campuses located across Arizona, California, Florida, Illinois, Michigan, North Carolina, Pennsylvania, New Jersey, and Texas. 4 out of 5 UTI graduates find employment in careers within their field of study within 1 year of graduation. You may opt-out by. Further information on these and other potential factors that could affect the financial results or condition may be found in the company's filings with the SEC. For internal reporting purposes, Concorde defines adjusted EBITDA as net income (loss) before interest expense, interest income, income taxes, depreciation, amortization and adjusted for items not considered part of the company's normal recurring operations. Last year in the quarter UTI generated $1.9 million or $0.08 per diluted share. UTI expanded its programs with additional curricula and opened new campuses, growing internally and through acquisitions. UTI is making more than $15 million in scholarships and grants available to students in 2022. 14) Incentive programs and employee eligibility are at the discretion of the employer and available at select locations. Dear Better Business Bureau of Orlando, On Monday, August 15, 2022, Universal Technical Institute (UTI) Orlando, FL campus received complaint case #XXXXXXXX. All statements contained in this press release, other than statements of historical fact, are "forward-looking" statements within the meaning of the safe harbor from civil liability provided for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). Technical Institute, Inc. All rights reserved please review UTI 's default rate, however, was relatively for. Consistent with full year annual report figures these schools, along with rank! 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