Bright Horizons Family Solutions Inc. (BFAM)
Consumer Cyclical · NYQ · US
Fundamentals
Valuation and ratings
Bright Horizons Family Solutions Inc. trades at USD73.99, which is 60% above the USD29.60 our discounted cash flow model puts on the business. On that measure it screens as expensive, which is not the same as saying it will fall.
Our moat model scores it 37 out of 100, which is little in the way of a moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 22.0 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Bright Horizons Family Solutions Inc.
Bright Horizons Family Solutions Inc. provides early education and childcare, comprehensive back-up care, educational advisory, and other workplace solutions services for employers and families in the United States, Puerto Rico, the United Kingdom, the Netherlands, Australia, and India. It operates in three segments: Full-Service Center-Based Child Care, Back-Up Care, and Educational Advisory services. The Full-Service Center-Based Child Care segment offers traditional center-based early education and childcare, preschool, and elementary education services. The Back-Up Care segment provides center-based back-up childcare, in-home child and senior care, school-age programs, camps, tutoring, pet care, and self-sourced reimbursed care services, as well as sittercity, an online marketplace for families and caregivers through early education and childcare centers, school-age programs and in-home care providers, the back-up care network, and other providers. The Educational Advisory services segment offers tuition assistance and student loan repayment program management, workforce education, and related educational consulting services, as well as college admissions and college financial advisory services. The company was formerly known as Bright Horizons Solutions Corp. and changed its name to Bright Horizons Family Solutions Inc. in July 2012. Bright Horizons Family Solutions Inc. was founded in 1986 and is headquartered in Newton, Massachusetts.
Smart money ownership
12 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Cliff Asness, AQR CAPITAL MANAGEMENT LLC$271.02M · 0.1% of book
- Abrams Bison, ABRAMS BISON INVESTMENTS, LLC$116.05M · 5.0% of book
- Two Sigma, TWO SIGMA INVESTMENTS, LP$111.18M · 0.1% of book
- Israel Englander, MILLENNIUM MANAGEMENT LLC$89.45M · 0.0% of book
- Francois Rochon, Giverny Capital Inc.$60.97M · 2.2% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Bright Horizons Family Solutions Inc. (BFAM) undervalued?
Against our discounted cash flow estimate of USD29.60, BFAM at USD73.99 is 60% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own BFAM?
12 of the institutions we track reported a position in BFAM in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is BFAM's P/E ratio?
BFAM trades at 22.0 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.