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what it is
Educational Development sells children’s books through a consultant network and wholesale channels across the U.S.
how it gets paid
Last year Educational Dev made $34M in revenue. Touchy-Feely board books was the main engine at $8.5M, or 25% of sales.
why it's growing
Revenue grew 415.2% last year. Gross margin was 59.4%, so product economics were not terrible.
what just happened
The cleanest takeaway is the full-year reset: EDUC finished fiscal 2025 at -$0.63 EPS after earning $0.07 the year before.
At a glance
C balance sheet — red flag territory — real financial stress
25/100 earnings predictability — expect surprises
2.7% return on capital — nothing to write home about
-$0.63 fy2025 EPS (reported)
$34M fy2025 revenue
xvary composite: 25/100 — weak
What they do
Educational Development sells children’s books through a consultant network and wholesale channels across the U.S.
EDUC wins with distribution, not size. It reaches buyers through two paths: Usborne Books & More consultants and EDC Publishing wholesale, with minimal long-term debt on the filing snapshot. If your school, library, or parent group already buys these titles, the repeat order is easier than building a brand from scratch.
How they make money
$34M
annual revenue · their business grew +415.2% last year
Touchy-Feely board books
$8.5M
Activity and flashcards
$6.8M
Sticker and art books
$5.4M
Science, math, and language titles
$6.1M
Adventure, search, chapter books, and novels
$7.2M
The products that matter
direct sales book distribution
PaperPie
$106.6M segment figure
This is the larger of the two reported segments at $106.6M, but the current company-wide revenue estimate is only $34M. That gap is the story: the direct-selling machine has lost a lot of scale.
largest segment
wholesale and retail publishing
Publishing
$33.7M segment figure
Publishing is reported at $33.7M. That's nearly the size of the current $34M company-wide revenue estimate by itself, which tells you the mix disclosure needs to be read with caution.
traditional channel
company-wide earnings power
current run rate
~$8.5M quarter-scale · -$0.63 FY2025 EPS
The number that matters right now is not the catalog. It is whether quarterly losses shrink against a -$0.63 full-year EPS outcome. You are not buying growth here. You are buying the hope of stabilization.
turnaround bet
Key numbers
$34M
annual revenue
That is the entire sales base. On a $12M market cap, every few million dollars of revenue matters a lot.
-$0.63
fy2025 eps
EPS → profit per share → so what: the company went from a $0.07 profit to a $0.63 loss per share in one year.
59.4%
gross margin (FY)
Gross margin → money left after product costs → so what: the books themselves are not the main problem. The rest of the cost stack is.
$0M
long-term debt
No long-term debt means the balance sheet is not the immediate fire. The income statement is.
Financial health
C
strength
- balance sheet grade C — very weak — significant financial distress
- risk rank 5 — safer than 5% of stocks
- price stability 10 / 100
- long-term debt minimal long-term debt
C — below average. watch for debt servicing and cash burn.
Total return vs. market
Return history isn't available for EDUC right now.
source: institutional data · return history unavailable
What just happened
missed estimates
The cleanest takeaway is the full-year reset: EDUC finished fiscal 2025 at -$0.63 EPS after earning $0.07 the year before.
Gross margin was 59.4%, so product economics were not terrible. The problem was scale and cost absorption, with the quarterly EPS history ending in four straight fiscal 2025 losses from -$0.15 to -$0.22.
~$8.5M
revenue (q)
-$0.18
eps (q)
59.4%
gross margin (FY)
the number that mattered
The number that mattered was -$0.63 for full-year EPS, because a business this small cannot hide a ~$0.70 per share swing from +$0.07 the prior year.
source: SEC filing and company earnings history, 2025
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What could go wrong
the #1 risk here is PaperPie channel deterioration and the cash pressure that follows it.
high
Revenue contraction
Q2 2026 net revenue fell to $4.6M from $6.5M a year earlier. That's a 29% drop in a business already estimated at just $34M in annual revenue.
If that pace continues, the debate stops being about valuation and starts being about survival.
high
Declining active brand partners
Management disclosed a decline in active brand partners in the latest quarter.
For a direct-selling model, fewer partners means the sales engine itself is shrinking. That can pressure future revenue even if the catalog stays intact.
high
Liquidity dependence on the new $2M line
The company secured a $2M credit line five days ago. Against $4.6M of quarterly revenue, that is a meaningful amount of external flexibility.
If the line becomes operating fuel rather than a backstop, equity holders move further down the priority list very quickly.
med
Auditor fraud-detection warning
On Jun 20, 2024, auditor Barbara J. Comly cited risk of not detecting a material misstatement from fraud.
That does not prove fraud. It does raise the cost of trust for a microcap that already needs credibility with lenders and investors.
A $2M line against $4.6M quarterly revenue and a 29% sales drop tells you liquidity, not valuation, is the immediate issue.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
Can quarterly revenue get back above $4.6M
You do not need a miracle first. You need proof the latest quarter was not the new normal.
risk
How fast the $2M credit line gets used
A lightly used backstop is one thing. Rapid drawdown would tell you operating cash is tighter than the headline debt figure suggests.
calendar
Next quarterly update on active brand partners
If partner count keeps falling, the direct-sales channel is still losing distribution muscle.
trend
Whether gross margin stays near 59.4%
If gross margin slips while revenue is already under pressure, the path back to profitability gets narrower fast.
Analyst rankings
earnings predictability
25 / 100
Earnings predictability measures how reliable the profit pattern has been. In human-speak: expect uneven results, not steady compounding.
risk rank
5
A risk rank of 5 means this screens as riskier than about 95% of stocks in the dataset. You are being paid in volatility, not certainty.
source: institutional data
Institutional activity
institutional ownership data for EDUC is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$1
current price
n/a
target midpoint · n/a from current
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