SLM (SLM) Net Margin Expansion Challenges Bearish Profitability Narratives In FY 2025 Results

Simply Wall St.01-24 10:37

SLM (SLM) closed out FY 2025 with Q4 revenue of US$472.9 million and basic EPS of US$1.14, while trailing 12 month EPS sat at US$3.52 on revenue of about US$1.7 billion. The company has seen quarterly...

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The company has seen quarterly...</p>\n\n<a href=\"https://simplywall.st/stocks/us/diversified-financials/nasdaq-slm/slm/news/slm-slm-net-margin-expansion-challenges-bearish-profitabilit\">Source Link</a>\n\n</div>\n","source":"simplywall_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>SLM (SLM) Net Margin Expansion Challenges Bearish Profitability Narratives In FY 2025 Results</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nSLM (SLM) Net Margin Expansion Challenges Bearish Profitability Narratives In FY 2025 Results\n</h2>\n\n<h4 class=\"meta\">\n\n\n2026-01-24 10:37 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://simplywall.st/stocks/us/diversified-financials/nasdaq-slm/slm/news/slm-slm-net-margin-expansion-challenges-bearish-profitabilit><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SLM (SLM) closed out FY 2025 with Q4 revenue of US$472.9 million and basic EPS of US$1.14, while trailing 12 month EPS sat at US$3.52 on revenue of about US$1.7 billion. The company has seen quarterly...</p>\n\n<a href=\"https://simplywall.st/stocks/us/diversified-financials/nasdaq-slm/slm/news/slm-slm-net-margin-expansion-challenges-bearish-profitabilit\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU2517655374.HKD","symbol_name":"WELLINGTON NEXT GENERATION EDUCATION \"A\" (HKD) ACC","start_time":0,"source_url":"https://simplywall.st/stocks/us/diversified-financials/nasdaq-slm/slm/news/slm-slm-net-margin-expansion-challenges-bearish-profitabilit","article_id":"2605386122","we_media_id":null,"thumbnails":["https://images.simplywall.st/asset/industry/7121000-choice1-main-header/1585186619635"],"rights":{"source":"simplywall_highlight","url":"https://simplywall.st/stocks/us/diversified-financials/nasdaq-slm/slm/news/slm-slm-net-margin-expansion-challenges-bearish-profitabilit","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2605386122","pubTimestamp":1769222250,"columns":[],"sourceInfo":{"source_id":"simplywall_highlight","name":"Simply Wall St."},"weMediaInfo":null,"summary":"SLM (SLM) closed out FY 2025 with Q4 revenue of US$472.9 million and basic EPS of US$1.14, while trailing 12 month EPS sat at US$3.52 on revenue of about US$1.7 billion. The company has seen quarterly revenue move from US$281.8 million and EPS of US$0.51 in Q4 FY 2024 to US$472.9 million and EPS of US$1.14 in Q4 FY 2025, alongside trailing 12 month EPS shifting between US$2.73 and US$3.52 over the same window. For investors, the combination of higher trailing margins and these headline...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU2517655374.HKD":"WELLINGTON NEXT GENERATION EDUCATION \"A\" (HKD) ACC","LU2517655028.SGD":"WELLINGTON NEXT GENERATION EDUCATION \"A\" (SGDHDG) ACC","SLM":"学贷美","LU2517655291.USD":"WELLINGTON NEXT GENERATION EDUCATION \"A\" (USD) ACC","BK7095":"多种金属与采矿","BK4166":"消费信贷","SLM.AU":"SOLIS MINERALS LTD"},"translate_title":"SLM(SLM)净利润扩张挑战2025财年业绩中看跌的盈利能力叙述","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"SLM.AU":1.5,"SLM":1.5},"content_text":"SLM (SLM) closed out FY 2025 with Q4 revenue of US$472.9 million and basic EPS of US$1.14, while trailing 12 month EPS sat at US$3.52 on revenue of about US$1.7 billion. The company has seen quarterly revenue move from US$281.8 million and EPS of US$0.51 in Q4 FY 2024 to US$472.9 million and EPS of US$1.14 in Q4 FY 2025, alongside trailing 12 month EPS shifting between US$2.73 and US$3.52 over the same window. For investors, the combination of higher trailing margins and these headline figures suggests it may be worth taking a closer look at how durable SLM’s profitability profile is. See our full analysis for SLM. With the numbers on the table, the next step is to compare SLM’s latest results with widely followed market narratives to see which views are backed by the data and which might need a rethink. Curious how numbers become stories that shape markets? Explore Community Narratives NasdaqGS:SLM Earnings & Revenue History as at Jan 2026 Advertisement44.1% Net Margin Puts Profit Quality In Focus  On a trailing basis SLM earned US$729.1 million of net income on US$1.7b of revenue, which works out to a 44.1% net margin compared with 41% a year earlier. What stands out for the bullish view is that trailing 12 month EPS of US$3.52 and net margin of 44.1% sit alongside a 23.6% year over year earnings increase, even though bulls also have to factor in forecasts that point to earnings declining about 7.3% per year and revenue easing around 2.6% per year over the next three years.\n     This combination of higher trailing margin and a 23.6% earnings uplift compared with a five year average decline of 16.2% per year heavily supports bullish arguments that SLM can still generate strong profitability on its existing book. At the same time, the forecast declines in both revenue and earnings give bulls less support for a simple growth story and instead put more attention on how efficiently that existing book is being run.    Over the past year SLM’s profitability has moved in a different direction to the longer term trend, which is exactly the kind of setup bulls argue can be mispriced when the focus stays on old averages. 📊 Read the full SLM Consensus Narrative. Valuation Discount vs DCF Fair Value Gap  SLM trades at US$27.62 per share, around 25.9% below a stated DCF fair value of about US$37.27, and on a 7.5x P/E that sits under both the 9x US Consumer Finance average and the 42.3x peer multiple. Supporters of a more optimistic angle point out that a 7.5x P/E against a 44.1% trailing net margin and US$3.52 of trailing EPS can make the stock look inexpensive, yet the same data also highlights why some investors stay cautious, as the revenue outlook of a 2.6% annual decline and earnings outlook of a 7.3% annual decline over the next three years sit uneasily beside any simple value argument.\n     On one hand, a share price sitting 25.9% below the DCF fair value and below industry P/E levels lines up cleanly with bullish claims that the market may be underappreciating current profitability. On the other, the forecast contraction in both top line and bottom line means that part of the low multiple can also be read as the market already baking in weaker future financial performance.    Debt And Dividend Coverage Flag Cash Flow Risk  The stock offers a 1.88% dividend yield, but that payout is not well covered by free cash flow, and operating cash flow is described as not covering debt comfortably. Critics who take a more bearish stance focus on this cash flow picture, arguing that the combination of weak debt coverage and a dividend not backed by free cash flow sits awkwardly alongside a 44.1% net margin and US$729.1 million of trailing net income, because it shows strong accounting profits without the same strength on the cash side.\n     This directly supports bearish worries that the balance sheet has less flexibility than the earnings line alone suggests, especially when earnings are forecast to decline about 7.3% per year. It also means that even with US$1.7b of trailing revenue, the company’s ability to comfortably service obligations and sustain dividends rests more on future cash generation improving than on reported profit levels.     Next Steps Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on SLM's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move. See What Else Is Out There For all SLM’s strong reported profitability, weak debt coverage, a dividend not backed by free cash flow, and forecast earnings declines put real pressure on its financial resilience. If that mix of tight cash flow and debt worries you, check out solid balance sheet and fundamentals stocks screener (388 results) to focus on companies with sturdier balance sheets and more comfortable coverage today.  This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.New: Manage All Your Stock Portfolios in One PlaceWe've created the ultimate portfolio companion for stock investors, and it's free.• Connect an unlimited number of Portfolios and see your total in one currency• Be alerted to new Warning Signs or Risks via email or mobile• Track the Fair Value of your stocksTry a Demo Portfolio for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. 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