KinderCare Learning Companies, — Earnings Quality Grade F
KLC · Consumer Defensive
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 16 days, change +2 days YoY
AR outpaced revenue for 2 consecutive years
Revenue 2.6%, CFFO 105.8%. Cash follows revenue
Expense Quality
No material inventory
CapEx growth -3.1% vs revenue 2.6%. Normal
SG&A/Gross Profit = 49.1%. Normal
Gross margin 22.1%, change -1.5pp. Stable
Cash Flow Quality
CFFO/NI = -2.11. Below 1.0
FCF $0.1B, FCF/NI = -0.98
Accruals ratio = -9.4%. Low accruals
Cash $0.1B covers only 5% of debt $2.5B
Balance Sheet Health
Goodwill+Intangibles $1.4B = 183% of equity. Over 50%
Debt/EBITDA = 22.0x (>4x). Financial stress
Other assets -12.9% vs revenue 2.6%. Normal
No write-off data
Acquisition Risk
FCF after acquisitions positive
Goodwill+Intangibles change -11% YoY. Normal
Manipulation Score
M-Score = -2.76 (< -2.22). Unlikely manipulator
Portfolio monitoring
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Beneish M-Score
Altman Z-Score
Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25