Value
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.5 |
| P/S | 9.4 |
| EV/EBITDA | 1.7 |
| Fwd P/E | 5.3 |
| PEG | 4.5 |
| Analyst target | 9.0 |
- ▸Forward P/E: 23.8x
- ▸PEG: 1.97
UTI · Why this verdict
Why Universal Technical Institute I (UTI) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score4.6/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Universal Technical Institute is down 57% from its 52-week high with 54.6% upside to the analyst target and a 3-for-3 earnings beat streak, but weak earnings quality, leverage of 2.0 and 78% reliance on Title IV funding keep it speculative.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Quality is below the minimum bar at 3.7 out of 10, with free cash flow at -13% of net income and high leverage at a debt-to-equity of 2.0. Bear case | Free cash flow turns positive and debt-to-equity falls below 1.5. | ↑Improving |
| CounterTwo value-trap signals (high leverage and insider selling) coincide with a weak cash record, which can persist. | ||
The $33.78 analyst target is 54.6% above the $21.85 price against 15.0% downside, a reward-to-risk of about 3.6. Targets | Price moves toward the analyst target as the beat streak continues. | ↓Deteriorating |
| CounterA target 78% above price is a sign analysts have not marked down estimates after a 57% drawdown, and the downtrend is confirmed. | ||
UTI has beaten EPS estimates in 3 of the last 4 quarters with no misses. Catalyst breakdown | EPS beats continue in the next 4 quarters. | ↓Deteriorating |
| CounterEarnings growth scores 0 out of 10 and cash flow is negative relative to net income, so beats are not translating into cash. | ||
78.0% of funding depends on Title IV federal student aid programs, a high-severity regulatory concentration risk. Bear case | Federal student aid eligibility is unaffected over the next 12 months. | ↑Improving |
| CounterChanges in federal aid rules would hit enrollment and revenue directly with little ability to offset. | ||
Insiders bought $315,019 and institutions are accumulating, but the stock is in an overbought bear rally with an RSI of 82 below a falling 200-day average. Insider breakdown | Institutional accumulation continues and price reclaims the 200-day moving average. | →Stable |
| CounterAn RSI of 82 within a confirmed downtrend is a classic bear-rally pattern, and a put/call ratio of 5.86 shows heavy hedging. | ||
Quality is below the minimum bar at 3.7 out of 10, with free cash flow at -13% of net income and high leverage at a debt-to-equity of 2.0.
↑ImprovingBear case
- Expectation
- Free cash flow turns positive and debt-to-equity falls below 1.5.
CounterTwo value-trap signals (high leverage and insider selling) coincide with a weak cash record, which can persist.
The $33.78 analyst target is 54.6% above the $21.85 price against 15.0% downside, a reward-to-risk of about 3.6.
↓DeterioratingTargets
- Expectation
- Price moves toward the analyst target as the beat streak continues.
CounterA target 78% above price is a sign analysts have not marked down estimates after a 57% drawdown, and the downtrend is confirmed.
UTI has beaten EPS estimates in 3 of the last 4 quarters with no misses.
↓DeterioratingCatalyst breakdown
- Expectation
- EPS beats continue in the next 4 quarters.
CounterEarnings growth scores 0 out of 10 and cash flow is negative relative to net income, so beats are not translating into cash.
78.0% of funding depends on Title IV federal student aid programs, a high-severity regulatory concentration risk.
↑ImprovingBear case
- Expectation
- Federal student aid eligibility is unaffected over the next 12 months.
CounterChanges in federal aid rules would hit enrollment and revenue directly with little ability to offset.
Insiders bought $315,019 and institutions are accumulating, but the stock is in an overbought bear rally with an RSI of 82 below a falling 200-day average.
→StableInsider breakdown
- Expectation
- Institutional accumulation continues and price reclaims the 200-day moving average.
CounterAn RSI of 82 within a confirmed downtrend is a classic bear-rally pattern, and a put/call ratio of 5.86 shows heavy hedging.
Per-dimension breakdown
Quality
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.5 |
| ROA | 2.3 |
| Gross margin | 7.0 |
| Op margin | 0.8 |
| Net margin | 1.9 |
| Current ratio | 4.9 |
| FCF quality | 0.0 |
| Moat | 5.8 |
| Piotroski F | 6.7 |
- ▸Earnings quality RED FLAG: -13% FCF/NI
Growth
2.1/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.3 |
| EPS growth | 0.0 |
Momentum
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 2.5 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 6.0 |
| Volume | 3.1 |
- ▸Overbought bear rally (RSI 77)
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -2.5%/30d — confirmed downtrend
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 4.5 |
| Analyst rating | 5.0 |
| Price target | 9.9 |
- ▸Analyst upside: 73%
Insider
7.9/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 6.5 |
| insider conviction | 8.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Modest insider buying — $315,019 (0.026% of mkt cap)
- ▸Institutions accumulating
Peer rank
2.6/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 1.9 |
| quality rank | 1.2 |
| growth rank | 5.8 |
Technical
1.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.0 |
| support resistance | 2.2 |
| 52w position | 0.0 |
Risk (lower is worse)
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 3.1 |
| days to cover | 6.9 |
| volatility | 2.3 |
| put call | 0.0 |
| implied vol | 2.1 |
| beta | 6.3 |
| debt equity | 4.9 |
| news risk | 6.0 |
- ▸Elevated put/call: 10.44
- ▸High IV: 68%
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 3.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| news activity | 6.0 |
- ▸Strong earnings: 3B/0M
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (7)
- MOMENTUM:6.3>=5.5
- ASYMMETRY:3.4>=1.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:20d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- DEATH_CROSS:momentum=6.3>=5.0 recovering
Reward-to-Risk
3.37
Upside
+50.6%
Downside
15.0%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 77
EdgeCatalyst-Driven — Earnings in 20d with 3/4 beat streak
SuitabilitySpeculative — Drawdown -57% (>40% off 52w high)
Investment implication
The SELL_IF_HOLDING verdict reflects clean gate clearance against Insider at 7.9 and asymmetric R:R of 3.37.
The strongest dimensions are Insider at 7.9, Catalyst at 6.9, and Momentum at 6.3; the weakest are Technical at 1.1, Growth at 2.1, and Peer rank at 2.6. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 3.37 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Large Gap To Analyst Target
Trip ifPrice falls more than 7% to the $20.32 stop level.
- P2Earnings Beat Streak
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P3Weak Earnings Quality Leverage
Trip ifDebt-to-equity exceeds 2.5 from the current 2.0 or free cash flow stays below 0% of net income for 4 quarters.
- P4Regulatory Title Iv Dependence
Trip ifTitle IV funding share rises above 85% from the current 78.0%.
- P5Insider Buying Institutional Accumulation
Trip ifPut/call ratio exceeds 8 from the current 5.86 while price stays below the 200-day average.