Start here if you're new
what it is
Franklin Covey sells training, coaching, and school programs that try to make people and organizations perform better.
how it gets paid
Last year Franklin Covey made $267M in revenue. Enterprise Division was the main engine at $172M, or 64% of sales.
why growth slowed
Revenue fell 7.0% last year. 75.5% was the tell. Revenue fell 7.0%, and the margin slipped from 76.3%, so less of each sale made it home.
what just happened
FC reported $64M in revenue and -$0.27 EPS last quarter.
At a glance
B+ balance sheet — decent shape, but not bulletproof
20/100 earnings predictability — expect surprises
86.0x trailing p/e — you're paying up for this one
4.6% return on capital — nothing to write home about
$0.24 fy2025 eps est
xvary composite: 47/100 — below average
What they do
Franklin Covey sells training, coaching, and school programs that try to make people and organizations perform better.
You are buying behavior change, not software, but the model still posted 75.5% gross margin. That means 75.5 cents of every sales dollar stayed after direct costs. With 1,120 employees supporting a $267M business, the subscription stack makes leaving painful once schools and managers are trained.
How they make money
$267M
annual revenue · their business grew -7.0% last year
Enterprise Division
$172M
7.0%
Education Division
$74M
7.0%
All Access Pass
$14M
+4.0%
Leader in Me membership
$7M
+2.0%
The products that matter
enterprise membership offering
All Access Pass
core offering · revenue down 7%
this is the subscription-style engine behind the enterprise pitch, but the latest quarter still showed revenue down 7% compared to last year. Recurring revenue gets a premium only when the revenue line behaves like it.
core driver
school membership program
Leader in Me
education pressure · gross margin 75.5%
education matters because the weakness showed up in margin fast. Company-wide gross margin slipped from 76.3% to 75.5%. In a business sold partly on its high-margin profile, small leaks matter.
margin watch
core brand and content library
The 7 Habits
brand asset · healthcare 17% of revenue
the brand still opens doors, but brands do not underwrite themselves. Healthcare already makes up 17% of revenue, so the next question is simple: does branded content keep winning in the verticals that still spend?
brand foundation
Key numbers
$267M
annual revenue
That is the whole business, and it fell 7.0% vs. prior year.
75.5%
gross margin
You kept 75.5 cents of every sales dollar before overhead. That is the clean part of the story.
86.0x
trailing p/e
You are paying 86 times earnings for a company whose revenue shrank 7.0%.
4.6%
return on capital
The business earns 4.6% on the money tied up in it. That is thin for the price.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 4 — safer than 20% of stocks
- price stability 40 / 100
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for FC right now.
source: institutional data · return history unavailable
What just happened
missed estimates
FC reported $64M in revenue and -$0.27 EPS last quarter.
Revenue fell 7.0% vs. prior year, while gross margin slipped to 75.5% from 76.3%. Lower Education Division margins and product amortization did the damage.
$64M
revenue
$0.27
eps
75.5%
gross margin
the number that mattered
75.5% was the tell. Revenue fell 7.0%, and the margin slipped from 76.3%, so less of each sale made it home.
source: company earnings report, 2026
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What could go wrong
the clean version of the FC story is simple: sticky memberships, high gross margin, and buybacks. The messier version is also simple: China weakened, margin slipped, and the stock still trades on a premium earnings multiple.
high
china-driven international weakness
international revenue fell to $11.2M as business in China softened because of geopolitical and trade tensions. That is a named problem with a named geography, not a vague macro excuse.
puts the current $11.2M international revenue base under more pressure
med
margin drift in a premium-multiple stock
gross margin slipped from 76.3% to 75.5%. That sounds small until you remember the stock is being asked to trade partly on that high-margin profile.
pressures the part of the story that justifies paying up
high
valuation vs. predictability mismatch
86.0x trailing p/e and a 20/100 predictability score do not belong together for long unless execution improves. The market is still paying for a cleaner earnings profile than recent results show.
raises the downside if another quarter misses the script
med
healthcare concentration
healthcare is 17% of revenue. Concentration helps when the vertical is healthy. If that spending cools, one of the clearer growth pockets gets smaller fast.
exposes roughly 17% of revenue to one customer budget cycle
if you held through the recent stumble, the next test is straightforward: revenue needs to stay inside the $265M–$275M guide and gross margin needs to stay around 75.5%. If one breaks, the premium multiple gets much harder to defend.
source: institutional data · regulatory filings · risk analysis
Pay attention to
earnings date
april 1, 2026 earnings report
the next print has to show the 775% EPS miss was a stumble, not the new baseline. the current snapshot also includes a $0.17 EPS estimate from Northland Securities.
guidance
FY2026 revenue staying inside $265M–$275M
management affirmed the range. if that range moves lower, the stock loses one of the few clean support points in the current story.
margin trend
gross margin holding near 75.5%
one quarter of slippage is manageable. two quarters in a row turns a small leak into a broken part of the thesis.
geographic risk
whether China softness stays local
international revenue is already down to $11.2M. if weakness spreads into broader enterprise demand, the story stops being a regional issue and starts looking structural.
Analyst rankings
earnings predictability
20 / 100
in human-speak, the earnings line is unreliable enough that one ugly quarter should not shock you.
risk rank
4
that means safer than only about 20% of stocks in this framework. you are not being paid for certainty here.
xvary composite
47 / 100
below average overall. the 75.5% gross margin helps, but weak predictability and an 86.0x trailing p/e pull the score back down.
source: institutional data
Institutional activity
institutional ownership data for FC is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$21
current price
n/a
target midpoint · n/a from current
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