Finvest
ATGE Education Services · For-profit education · Healthcare training · Thesis updated July 1, 2026

Turnaround works, but aid rules still loom

01 Running thesis

Growth is back on trial

Adtalem has moved past the first turnaround question. The old question was whether Chamberlain, its large nursing school, could stop slipping. Q3 FY2026 gave a better answer: Chamberlain enrollment rose 0.5% year over year, Walden rose 12.3%, and Medical and Veterinary rose 4.1%.

The bull case is now stronger. Walden keeps adding students at a double-digit rate, Chamberlain has returned to positive growth, and management raised full-year guidance. The new FY2026 outlook calls for revenue of $1.93 billion to $1.945 billion and adjusted EPS of $7.95 to $8.15.

The bear case is not gone. Chamberlain growth is still tiny, so one weak session could bring the worry back. There is also a mix question inside Chamberlain: pre-licensure nursing is growing while post-licensure nursing has been weaker. If the growing programs earn less per student or carry higher costs, profit growth may lag enrollment growth.

The next test is not whether the business can grow at all. It is whether this growth can last, produce good margins, and survive changes to federal student loan rules.

May 2026▲Q3 FY2026 strengthened the thesis. Chamberlain returned to 0.5% enrollment growth, Walden grew 12.3%, Medical and Veterinary grew 4.1%, and management raised revenue and adjusted EPS guidance.
Jan 2026→Q2 created a mixed view. Chamberlain enrollment fell 1.0% in the November 2025 session, but management called it a temporary pause and Walden still grew 13.0%.
Oct 2025▲Q1 FY2026 showed strong momentum, with revenue up 10.8%, adjusted EPS up 35.7%, and total enrollment up 8.0%. A new law-firm inquiry added legal risk to monitor.
Aug 2025▲FY2025 results showed revenue growth across all segments, including Chamberlain revenue up 14.6% and Walden revenue up 16.5%. The same filing added the OBBBA student aid overhaul as a major new risk.
May 2025▲Q3 FY2025 improved confidence. Management raised FY2025 guidance and Medical and Veterinary returned to enrollment growth at 1.2%.
02 Business model

Tuition funded by aid

Adtalem makes money when students enroll in its schools and pay tuition and fees. Its schools focus on healthcare jobs, including nursing, medicine, veterinary medicine, public health, counseling, and social work.

The model depends heavily on U.S. federal student aid. Adtalem says its institutions collectively receive 75% of revenue from Title IV programs. Title IV is the federal aid system that helps students pay for college through grants and loans.

That makes accreditation and Department of Education compliance central to the business. If a school loses access to aid, breaks the 90/10 rule, fails financial responsibility tests, or gets hit by gainful employment rules, the damage could be severe.

The moat comes from scale, known school brands, healthcare focus, and existing accreditation. The weakness is that the same regulated funding system that supports demand can also hurt the company if rules change.

03 Product portfolio

Healthcare schools under one roof

Steady

Chamberlain University

Chamberlain offers nursing and health programs, including BSN, MSN, and DNP degrees. It is the key turnaround asset after returning to 0.5% enrollment growth in the March 2026 session.

Growth engine

Walden University

Walden is mostly online and serves working adults in fields like nursing, education, counseling, business, psychology, public health, and social work. It posted 12.3% enrollment growth as of March 31, 2026.

Option

American University of the Caribbean School of Medicine

AUC offers an MD path mainly for students aiming at U.S. medical careers. Its value depends on student demand, clinical rotation access, and residency outcomes.

Option

Ross University School of Medicine

RUSM is another international medical school serving many U.S.-bound students. It can grow, but medical school capacity and clinical placement needs limit speed.

Steady

Ross University School of Veterinary Medicine

RUSVM offers a DVM program and adds exposure to veterinary education. It sits inside the Medical and Veterinary segment, which grew enrollment 4.1% year over year in the latest cited semester.

04 Business segments

Three pieces of revenue

Chamberlain41%flat
Walden39%growing fast
Medical and Veterinary20%modest

Segment shares use FY2025 revenue from the Form 10-K. Chamberlain was $725.8 million, Walden was $693.4 million, and the remaining Medical and Veterinary revenue is derived from total Adtalem revenue of $1.7883 billion.

05 Risk factors

What could break

Federal aid access

High impact · Medium odds

Adtalem schools get 75% of revenue from Title IV federal aid programs. If one or more schools lose eligibility, face limits, or have to repay funds, the business would be hit hard. Rules such as 90/10, gainful employment, financial responsibility tests, and accreditation standards all matter.

We watchDepartment of Education actions, 90/10 compliance, gainful employment results, accreditation notices, and Title IV eligibility disclosures.

Student loan rule changes

High impact · Medium odds

The One Big Beautiful Bill Act changes federal student aid, including a phaseout of Grad PLUS loans and new aggregate loan caps. Adtalem has not yet shown the full effect because implementing rules are still developing. If students cannot finance programs as easily, enrollment could slow.

We watchFinal rules tied to OBBBA, changes in student borrowing, and enrollment trends after new loan caps take effect.

Chamberlain stalls again

Medium impact · Medium odds

Chamberlain has returned to growth, but the latest growth rate was only 0.5% year over year. That is better than decline, but it is not a large cushion. Post-licensure nursing weakness remains the part to watch.

We watchChamberlain May and July 2026 enrollment, post-licensure applications, and funnel conversion rates.

Lower-margin student mix

Medium impact · Medium odds

Management says pre-licensure nursing is growing while post-licensure nursing has declined. The company has not clearly shown the margin and revenue per student for each group in the supplied record. If growth shifts toward lower-profit programs, earnings could disappoint even if enrollment rises.

We watchChamberlain segment margin, revenue per student, and management comments on pre-licensure versus post-licensure economics.

Legal and reputation hits

Medium impact · Medium odds

For-profit education companies can face audits, investigations, lawsuits, and bad press. Adtalem has also had a law-firm inquiry into possible securities fraud noted in the record. Even if claims do not lead to large penalties, they can hurt enrollment and the stock.

We watchNew lawsuits, agency investigations, settlement costs, and changes in student starts after negative publicity.
06 Quick answers

In one breath

What does Adtalem Global Education do?

Adtalem runs for-profit colleges and universities focused mainly on healthcare. Its biggest brands include Chamberlain University, Walden University, AUC, Ross University School of Medicine, and Ross University School of Veterinary Medicine.

Why is Walden important to ATGE?

Walden is the fastest-growing major piece of Adtalem right now. Its enrollment rose 12.3% year over year as of March 31, 2026, making it the main growth engine.

Why do investors care about Chamberlain enrollment?

Chamberlain is a large nursing school and a major part of revenue. Its March 2026 enrollment rose 0.5% year over year, which suggests the prior decline has stabilized, but the growth rate is still thin.

What is the biggest risk for ATGE stock?

The biggest risk is federal student aid. Adtalem institutions get 75% of revenue from Title IV programs, so loan caps, aid rule changes, or loss of eligibility could hurt enrollment and revenue.