PEARSON PLC-SPONSORED ADR (PSO) Stock Fundamental Analysis

NYSE:PSO • US7050151056

12.795 USD
+0.14 (+1.15%)
Last: Feb 25, 2026, 11:44 AM
Overview Stock Chart Technical Analysis Fundamental Analysis Analyst Ratings Earnings Estimates Financials Ownership News
Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to PSO. PSO was compared to 75 industry peers in the Diversified Consumer Services industry. PSO gets an excellent profitability rating and is at the same time showing great financial health properties. PSO has a valuation in line with the averages, but on the other hand it scores bad on growth.


Dividend Valuation Growth Profitability Health

7

1. Profitability

1.1 Basic Checks

  • In the past year PSO was profitable.
  • In the past year PSO had a positive cash flow from operations.
  • Each year in the past 5 years PSO has been profitable.
  • PSO had a positive operating cash flow in each of the past 5 years.
PSO Yearly Net Income VS EBIT VS OCF VS FCFPSO Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 500M -500M -1B -1.5B -2B

1.2 Ratios

  • The Return On Assets of PSO (7.08%) is better than 74.67% of its industry peers.
  • PSO has a Return On Equity of 12.29%. This is in the better half of the industry: PSO outperforms 66.67% of its industry peers.
  • The Return On Invested Capital of PSO (8.65%) is better than 74.67% of its industry peers.
  • PSO had an Average Return On Invested Capital over the past 3 years of 6.70%. This is below the industry average of 11.01%.
  • The 3 year average ROIC (6.70%) for PSO is below the current ROIC(8.65%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 7.08%
ROE 12.29%
ROIC 8.65%
ROA(3y)5.07%
ROA(5y)4.41%
ROE(3y)8.59%
ROE(5y)7.58%
ROIC(3y)6.7%
ROIC(5y)5.84%
PSO Yearly ROA, ROE, ROICPSO Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 -20 -40

1.3 Margins

  • PSO's Profit Margin of 12.53% is fine compared to the rest of the industry. PSO outperforms 77.33% of its industry peers.
  • PSO's Profit Margin has improved in the last couple of years.
  • The Operating Margin of PSO (15.77%) is better than 80.00% of its industry peers.
  • In the last couple of years the Operating Margin of PSO has grown nicely.
  • With a Gross Margin value of 51.45%, PSO perfoms like the industry average, outperforming 58.67% of the companies in the same industry.
  • PSO's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 15.77%
PM (TTM) 12.53%
GM 51.45%
OM growth 3Y25.2%
OM growth 5Y6.89%
PM growth 3Y33.26%
PM growth 5Y12.36%
GM growth 3Y1.31%
GM growth 5Y-0.38%
PSO Yearly Profit, Operating, Gross MarginsPSO Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40 -40

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ROAROEROICOperating and Profit MarginShow most profitable peers

7

2. Health

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), PSO is destroying value.
  • Compared to 1 year ago, PSO has less shares outstanding
  • PSO has less shares outstanding than it did 5 years ago.
  • The debt/assets ratio for PSO is higher compared to a year ago.
PSO Yearly Shares OutstandingPSO Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 200M 400M 600M
PSO Yearly Total Debt VS Total AssetsPSO Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B 10B

2.2 Solvency

  • An Altman-Z score of 2.63 indicates that PSO is not a great score, but indicates only limited risk for bankruptcy at the moment.
  • Looking at the Altman-Z score, with a value of 2.63, PSO is in the better half of the industry, outperforming 70.67% of the companies in the same industry.
  • The Debt to FCF ratio of PSO is 2.42, which is a good value as it means it would take PSO, 2.42 years of fcf income to pay off all of its debts.
  • PSO has a Debt to FCF ratio of 2.42. This is amongst the best in the industry. PSO outperforms 81.33% of its industry peers.
  • A Debt/Equity ratio of 0.40 indicates that PSO is not too dependend on debt financing.
  • With a Debt to Equity ratio value of 0.40, PSO perfoms like the industry average, outperforming 49.33% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.4
Debt/FCF 2.42
Altman-Z 2.63
ROIC/WACC0.8
WACC10.75%
PSO Yearly LT Debt VS Equity VS FCFPSO Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

2.3 Liquidity

  • PSO has a Current Ratio of 2.31. This indicates that PSO is financially healthy and has no problem in meeting its short term obligations.
  • The Current ratio of PSO (2.31) is better than 81.33% of its industry peers.
  • PSO has a Quick Ratio of 2.24. This indicates that PSO is financially healthy and has no problem in meeting its short term obligations.
  • With a decent Quick ratio value of 2.24, PSO is doing good in the industry, outperforming 80.00% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 2.31
Quick Ratio 2.24
PSO Yearly Current Assets VS Current LiabilitesPSO Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

3

3. Growth

3.1 Past

  • PSO shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.29%.
  • The Earnings Per Share has been growing slightly by 1.15% on average over the past years.
  • Looking at the last year, PSO shows a decrease in Revenue. The Revenue has decreased by -0.82% in the last year.
  • The Revenue has been decreasing by -1.70% on average over the past years.
EPS 1Y (TTM)3.29%
EPS 3Y20.87%
EPS 5Y1.15%
EPS Q2Q%-5.47%
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y1.19%
Revenue growth 5Y-1.7%
Sales Q2Q%-1.82%

3.2 Future

  • The Earnings Per Share is expected to grow by 6.77% on average over the next years.
  • Based on estimates for the next years, PSO will show a small growth in Revenue. The Revenue will grow by 3.01% on average per year.
EPS Next Y3.3%
EPS Next 2Y6.83%
EPS Next 3Y8.22%
EPS Next 5Y6.77%
Revenue Next Year0.03%
Revenue Next 2Y2.27%
Revenue Next 3Y3.06%
Revenue Next 5Y3.01%

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
  • The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
PSO Yearly Revenue VS EstimatesPSO Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 1B 2B 3B 4B
PSO Yearly EPS VS EstimatesPSO Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 0.2 0.4 0.6 0.8

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6

4. Valuation

4.1 Price/Earnings Ratio

  • With a Price/Earnings ratio of 15.05, PSO is valued correctly.
  • Compared to the rest of the industry, the Price/Earnings ratio of PSO indicates a somewhat cheap valuation: PSO is cheaper than 70.67% of the companies listed in the same industry.
  • Compared to an average S&P500 Price/Earnings ratio of 26.98, PSO is valued a bit cheaper.
  • PSO is valuated correctly with a Price/Forward Earnings ratio of 12.84.
  • Based on the Price/Forward Earnings ratio, PSO is valued cheaply inside the industry as 81.33% of the companies are valued more expensively.
  • The average S&P500 Price/Forward Earnings ratio is at 28.01. PSO is valued rather cheaply when compared to this.
Industry RankSector Rank
PE 15.05
Fwd PE 12.84
PSO Price Earnings VS Forward Price EarningsPSO Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, PSO is valued a bit cheaper than the industry average as 70.67% of the companies are valued more expensively.
  • Based on the Price/Free Cash Flow ratio, PSO is valued cheaper than 88.00% of the companies in the same industry.
Industry RankSector Rank
P/FCF 9.75
EV/EBITDA 9.14
PSO Per share dataPSO EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6

4.3 Compensation for Growth

  • The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
  • The decent profitability rating of PSO may justify a higher PE ratio.
PEG (NY)4.57
PEG (5Y)13.07
EPS Next 2Y6.83%
EPS Next 3Y8.22%

More info and screens

Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

6

5. Dividend

5.1 Amount

  • With a Yearly Dividend Yield of 2.64%, PSO has a reasonable but not impressive dividend return.
  • PSO's Dividend Yield is rather good when compared to the industry average which is at 0.40. PSO pays more dividend than 93.33% of the companies in the same industry.
  • PSO's Dividend Yield is a higher than the S&P500 average which is at 1.81.
Industry RankSector Rank
Dividend Yield 2.64%

5.2 History

  • The dividend of PSO has a limited annual growth rate of 4.00%.
  • PSO has paid a dividend for at least 10 years, which is a reliable track record.
  • PSO has decreased its dividend in the last 3 years.
Dividend Growth(5Y)4%
Div Incr Years2
Div Non Decr Years2
PSO Yearly Dividends per sharePSO Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0.2 0.4 0.6

5.3 Sustainability

  • 36.05% of the earnings are spent on dividend by PSO. This is a low number and sustainable payout ratio.
  • The dividend of PSO is growing, but earnings are growing more, so the dividend growth is sustainable.
DP36.05%
EPS Next 2Y6.83%
EPS Next 3Y8.22%
PSO Yearly Income VS Free CF VS DividendPSO Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 500M -500M -1B -1.5B -2B
PSO Dividend Payout.PSO Dividend Payout, showing the Payout Ratio.PSO Dividend Payout.PayoutRetained Earnings

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PEARSON PLC-SPONSORED ADR

NYSE:PSO (2/25/2026, 11:44:34 AM)

12.795

+0.14 (+1.15%)

Chartmill FA Rating
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)N/A
Earnings (Next)02-27
Inst Owners79.26%
Inst Owner Change14.24%
Ins Owners0.2%
Ins Owner ChangeN/A
Market Cap8.10B
Revenue(TTM)3.52B
Net Income(TTM)441.00M
Analysts75
Price Target16.87 (31.85%)
Short Float %0.48%
Short Ratio3.04
Dividend
Industry RankSector Rank
Dividend Yield 2.64%
Yearly Dividend0.33
Dividend Growth(5Y)4%
DP36.05%
Div Incr Years2
Div Non Decr Years2
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0.07%
PT rev (3m)0.83%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0.32%
EPS NY rev (3m)0.67%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0.17%
Revenue NY rev (3m)0.36%
Valuation
Industry RankSector Rank
PE 15.05
Fwd PE 12.84
P/S 1.71
P/FCF 9.75
P/OCF 8.07
P/B 1.67
P/tB 7.7
EV/EBITDA 9.14
EPS(TTM)0.85
EY6.64%
EPS(NY)1
Fwd EY7.79%
FCF(TTM)1.31
FCFY10.26%
OCF(TTM)1.59
OCFY12.39%
SpS7.5
BVpS7.65
TBVpS1.66
PEG (NY)4.57
PEG (5Y)13.07
Graham Number12.09
Profitability
Industry RankSector Rank
ROA 7.08%
ROE 12.29%
ROCE 10.65%
ROIC 8.65%
ROICexc 9.26%
ROICexgc 21.92%
OM 15.77%
PM (TTM) 12.53%
GM 51.45%
FCFM 17.5%
ROA(3y)5.07%
ROA(5y)4.41%
ROE(3y)8.59%
ROE(5y)7.58%
ROIC(3y)6.7%
ROIC(5y)5.84%
ROICexc(3y)7.48%
ROICexc(5y)7.31%
ROICexgc(3y)20.27%
ROICexgc(5y)22.68%
ROCE(3y)8.26%
ROCE(5y)7.2%
ROICexgc growth 3Y7.27%
ROICexgc growth 5Y10.63%
ROICexc growth 3Y17.53%
ROICexc growth 5Y6.81%
OM growth 3Y25.2%
OM growth 5Y6.89%
PM growth 3Y33.26%
PM growth 5Y12.36%
GM growth 3Y1.31%
GM growth 5Y-0.38%
F-Score8
Asset Turnover0.57
Health
Industry RankSector Rank
Debt/Equity 0.4
Debt/FCF 2.42
Debt/EBITDA 1.84
Cap/Depr 58.45%
Cap/Sales 3.64%
Interest Coverage 10.09
Cash Conversion 96.12%
Profit Quality 139.68%
Current Ratio 2.31
Quick Ratio 2.24
Altman-Z 2.63
F-Score8
WACC10.75%
ROIC/WACC0.8
Cap/Depr(3y)49.36%
Cap/Depr(5y)46.7%
Cap/Sales(3y)3.58%
Cap/Sales(5y)3.97%
Profit Quality(3y)103.3%
Profit Quality(5y)94.38%
High Growth Momentum
Growth
EPS 1Y (TTM)3.29%
EPS 3Y20.87%
EPS 5Y1.15%
EPS Q2Q%-5.47%
EPS Next Y3.3%
EPS Next 2Y6.83%
EPS Next 3Y8.22%
EPS Next 5Y6.77%
Revenue 1Y (TTM)-0.82%
Revenue growth 3Y1.19%
Revenue growth 5Y-1.7%
Sales Q2Q%-1.82%
Revenue Next Year0.03%
Revenue Next 2Y2.27%
Revenue Next 3Y3.06%
Revenue Next 5Y3.01%
EBIT growth 1Y9.47%
EBIT growth 3Y26.69%
EBIT growth 5Y5.08%
EBIT Next Year39.42%
EBIT Next 3Y15.89%
EBIT Next 5Y14.38%
FCF growth 1Y133.33%
FCF growth 3Y49.68%
FCF growth 5Y23.37%
OCF growth 1Y82.8%
OCF growth 3Y24.36%
OCF growth 5Y11.19%

PEARSON PLC-SPONSORED ADR / PSO FAQ

What is the ChartMill fundamental rating of PEARSON PLC-SPONSORED ADR (PSO) stock?

ChartMill assigns a fundamental rating of 6 / 10 to PSO.


What is the valuation status for PSO stock?

ChartMill assigns a valuation rating of 6 / 10 to PEARSON PLC-SPONSORED ADR (PSO). This can be considered as Fairly Valued.


How profitable is PEARSON PLC-SPONSORED ADR (PSO) stock?

PEARSON PLC-SPONSORED ADR (PSO) has a profitability rating of 7 / 10.


Can you provide the financial health for PSO stock?

The financial health rating of PEARSON PLC-SPONSORED ADR (PSO) is 7 / 10.


Can you provide the expected EPS growth for PSO stock?

The Earnings per Share (EPS) of PEARSON PLC-SPONSORED ADR (PSO) is expected to grow by 3.3% in the next year.