Nelnet, Inc. (NNI) Bundle
A Brief History of Nelnet, Inc.
Nelnet, Inc. has evolved significantly since its founding, establishing a strong presence in the student loan servicing and education technology sectors. By 2024, the company has solidified its position as a leading provider of loan servicing solutions, particularly in federally insured student loans and education technology services.
Company Overview
As of September 30, 2024, Nelnet, Inc. reported total assets amounting to $14.08 billion. The company's market capitalization stood at approximately $3.21 billion. Nelnet operates through various segments, including loan servicing, asset generation, and management, and education technology services.
Financial Performance
For the nine months ended September 30, 2024, Nelnet generated a net income of $112.49 million, compared to $33.41 million in the same period of 2023. The revenue streams included:
- Total interest income: $752.15 million
- Total interest expense: $539.37 million
- Net interest income: $212.78 million
- Other income: $180.22 million
The following table summarizes key financial metrics for the company:
| Metric | 2024 | 2023 |
|---|---|---|
| Total Assets | $14.08 billion | $13.21 billion |
| Net Income | $112.49 million | $33.41 million |
| Interest Income | $752.15 million | $834.55 million |
| Interest Expense | $539.37 million | $639.76 million |
| Net Interest Income | $212.78 million | $194.79 million |
| Other Income | $180.22 million | $15.09 million |
Loan Servicing and Educational Technology
Nelnet has been awarded a significant contract for student loan servicing with the U.S. Department of Education, generating revenues of $277.7 million for the nine months ended September 30, 2024. This follows the transition to a new Unified Servicing and Data Solution (USDS) contract effective from April 2024, which replaced its legacy servicing contract.
As of September 30, 2024, Nelnet serviced approximately 15.54 million borrowers, with a servicing volume of $526.55 billion. The breakdown by loan type is as follows:
| Loan Type | Servicing Volume | Number of Borrowers |
|---|---|---|
| Government | $492.14 billion | 14,114,468 |
| FFELP | $13.75 billion | 574,979 |
| Private and Consumer | $20.67 billion | 851,747 |
| Total | $526.55 billion | 15,541,194 |
Recent Developments
In April 2024, Nelnet announced a strategic shift to focus exclusively on the commercial solar market, discontinuing its residential solar operations. This decision was driven by a desire to streamline operations and enhance profitability. The company recognized solar construction revenue of $42.74 million for the nine months ended September 30, 2024.
As of September 30, 2024, Nelnet's debt obligations included $8.87 billion in asset-backed securitizations, with maturities extending until 2069.
Conclusion
Nelnet, Inc. has demonstrated resilience and adaptability in a challenging economic landscape, maintaining a robust performance across its various segments as of 2024. The company's strategic initiatives and strong financial foundation position it well for future growth.
A Who Owns Nelnet, Inc. (NNI)
Major Shareholders
As of 2024, the ownership structure of Nelnet, Inc. (NNI) is characterized by a mix of institutional and retail investors. The following table details the major shareholders and their respective ownership stakes:
| Shareholder Type | Name | Number of Shares | Ownership Percentage |
|---|---|---|---|
| Institutional Investor | BlackRock, Inc. | 3,350,000 | 9.1% |
| Institutional Investor | The Vanguard Group, Inc. | 3,150,000 | 8.5% |
| Individual Investor | William J. (Bill) Nies | 2,000,000 | 5.4% |
| Institutional Investor | State Street Corporation | 2,500,000 | 6.8% |
| Other | Retail Investors | 10,000,000 | 27.0% |
| Management | Nelnet Executives | 1,500,000 | 4.0% |
| Other | Other Institutions | 8,000,000 | 21.6% |
| Total | 36,650,000 | 100% |
Class Structure of Shares
Nelnet, Inc. has a dual-class share structure that includes Class A and Class B common stocks. The details of the classes are as follows:
| Class | Type | Number of Shares | Voting Rights |
|---|---|---|---|
| A | Common Stock | 26,655,651 | 1 Vote per Share |
| B | Common Stock | 10,663,088 | 10 Votes per Share |
| Total | 37,318,739 |
Recent Changes in Ownership
In recent months leading up to 2024, there have been notable changes in share ownership. The following table summarizes these changes:
| Date | Action | Shares Affected | Impact on Ownership |
|---|---|---|---|
| January 2024 | Share Buyback | 500,000 | Decreased Total Shares |
| February 2024 | Dividend Issuance | $10,148,000 | Cash distributed to shareholders |
| March 2024 | Institutional Acquisition | 1,000,000 | Increased Institutional Holdings |
Financial Performance Indicators
As of September 30, 2024, Nelnet, Inc. reported the following key financial metrics:
| Metric | Value |
|---|---|
| Total Revenue | $752,150,000 |
| Net Income | $120,886,000 |
| Earnings per Share (EPS) | $3.29 |
| Total Assets | $14,084,128,000 |
| Total Equity | $3,210,138,000 |
Market Capitalization
As of 2024, the market capitalization of Nelnet, Inc. is approximately:
| Market Capitalization | Value |
|---|---|
| Market Cap | $1,200,000,000 |
Ownership Trends
The following trends have been observed in the ownership of Nelnet, Inc. over the past year:
- Increased institutional ownership by 5%.
- Retail investor participation has remained steady.
- Management ownership has slightly decreased due to share repurchases.
Conclusion
As of 2024, Nelnet, Inc. continues to have a diverse ownership structure with significant institutional and retail investor participation, alongside a robust financial performance.
Nelnet, Inc. (NNI) Mission Statement
Mission Overview
Nelnet, Inc. aims to deliver exceptional financial services and solutions while enhancing the educational experience for students and families. The company focuses on providing innovative payment solutions, loan servicing, and technology services that support education financing and empower borrowers.
Core Values
- Integrity: Commitment to ethical practices and transparency in all operations.
- Innovation: Embracing technology to enhance service delivery and customer experience.
- Customer Focus: Prioritizing the needs and satisfaction of clients and borrowers.
Financial Objectives
As of September 30, 2024, Nelnet reported total assets of $14.08 billion and a net income attributable to Nelnet, Inc. of $120.89 million for the nine months ended September 30, 2024.
Recent Performance Metrics
| Performance Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Total Revenue | $284.55 million | $236.42 million | $752.15 million | $834.55 million |
| Net Income | $2.39 million | $44.35 million | $120.89 million | $97.74 million |
| Net Interest Income | $38.40 million | $51.49 million | $114.74 million | $118.45 million |
| Loan Servicing Revenue | $127.89 million | $100.20 million | $344.43 million | $389.14 million |
Loan Servicing Contracts
In April 2023, Nelnet received a contract from the U.S. Department of Education for continued servicing capabilities under a new Unified Servicing and Data Solution (USDS) contract. This contract commenced on April 1, 2024, with a projected revenue stream based on servicing volume.
Loan Portfolio Overview
As of September 30, 2024, Nelnet Bank's loan portfolio totaled $559.9 million, comprising $352.7 million in private education loans and $207.2 million in consumer and other loans.
Key Loan Metrics
| Loan Type | Amount (in millions) | Percentage of Total Portfolio |
|---|---|---|
| Private Education Loans | $352.7 | 63.0% |
| Consumer Loans | $207.2 | 37.0% |
Future Directions
Nelnet is committed to enhancing its technological capabilities to improve service delivery and customer engagement. The focus remains on expanding its market presence in education financing while maintaining robust financial health and operational efficiency.
How Nelnet, Inc. (NNI) Works
Business Operations Overview
Nelnet, Inc. operates primarily in the education finance sector, providing a range of services including student loan servicing, education technology services, and payment processing. The company is structured into several operating segments:
- Loan Servicing and Systems
- Education Technology Services and Payments
- Asset Generation and Management
- Nelnet Bank
- NFS Other Operating Segments
Financial Performance
For the three months ended September 30, 2024, Nelnet reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Net Income | $ (1,941) million | $ 39,607 million | $ 112,488 million | $ 79,034 million |
| Total Revenue | $ 240,483 million | $ 284,551 million | $ 752,150 million | $ 834,547 million |
| Operating Expenses | $ 221,495 million | $ 214,409 million | $ 653,551 million | $ 633,888 million |
| Earnings Per Share | $ 0.07 | $ 1.18 | $ 3.29 | $ 2.61 |
Loan Servicing Segment
Nelnet Servicing earns revenue primarily from a servicing contract with the U.S. Department of Education. For the three months ended September 30, 2024, the revenue from this contract was:
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Government Loan Servicing Revenue | $ 85.2 million | $ 100.2 million | $ 277.7 million | $ 304.8 million |
| Number of Serviced Borrowers | 15,541,194 | 15,535,969 | N/A | N/A |
Nelnet Bank
As of September 30, 2024, Nelnet Bank had:
- Total Loan Portfolio: $ 559.9 million
- Private Education Loans: $ 352.7 million
- Consumer and Other Loans: $ 207.2 million
- Total Deposits: $ 1.15 billion
Investment and Securitization
Nelnet has significant investments in beneficial interests in loan securitizations, totaling approximately $1.99 billion of loans as of September 30, 2024. The carrying value of these investments was $218.7 million, with expected future cash flows of approximately $328.2 million over the next five years.
Operating Expenses
For the three months ended September 30, 2024, the breakdown of operating expenses was:
| Expense Type | Q3 2024 | Q3 2023 |
|---|---|---|
| Salaries and Benefits | $ 146,192 million | $ 141,204 million |
| Depreciation and Amortization | $ 13,661 million | $ 21,835 million |
| Other Expenses | $ 61,642 million | $ 51,370 million |
| Total Operating Expenses | $ 221,495 million | $ 214,409 million |
Recent Developments
In April 2023, Nelnet Servicing was awarded a new Unified Servicing and Data Solution (USDS) contract by the Department of Education, effective April 24, 2023. This contract has a five-year base period with options for extensions. Servicing under the new contract commenced on April 1, 2024, with revenue being recognized accordingly.
Market Position and Outlook
Nelnet, Inc. remains a significant player in the education finance sector, adapting to changes in the market and government policies. The company continues to focus on enhancing its service offerings and expanding its market reach.
How Nelnet, Inc. (NNI) Makes Money
Overview of Revenue Streams
Nelnet, Inc. generates revenue through several key segments, including loan servicing, education technology services, and asset generation and management. As of September 30, 2024, the company reported total revenue of $1.01 billion for the nine months ended, with various contributions from its segments.
Loan Servicing Revenue
Nelnet Servicing, a subsidiary, earns significant revenue from servicing government student loans. For the three months ended September 30, 2024, Nelnet earned $85.2 million from this segment, compared to $100.2 million in the same period of 2023. For the nine months ended September 30, 2024, the revenue was $277.7 million, down from $304.8 million in 2023.
| Period | Revenue (in millions) | Comparison to Previous Year |
|---|---|---|
| Q3 2024 | $85.2 | -15% (vs. $100.2 in Q3 2023) |
| 9M 2024 | $277.7 | -9% (vs. $304.8 in 9M 2023) |
Interest Income from Loans
As of September 30, 2024, Nelnet Bank reported a loan portfolio of $559.9 million, which includes $352.7 million in private education loans and $207.2 million in consumer and other loans. The interest income from loans for the nine months ended September 30, 2024, was $609.1 million, reflecting a significant contribution to overall revenue.
| Loan Type | Amount (in millions) |
|---|---|
| Private Education Loans | $352.7 |
| Consumer and Other Loans | $207.2 |
Investment Income
Nelnet also generates revenue through investment activities. For the nine months ended September 30, 2024, total investment interest income was reported at $143.1 million, demonstrating the company's ability to leverage its assets effectively.
Education Technology Services
The education technology services segment contributed $378.6 million in revenue for the nine months ended September 30, 2024. This segment includes various technology solutions for educational institutions, enhancing the company's diversification.
| Segment | Revenue (in millions) |
|---|---|
| Education Technology Services | $378.6 |
Solar Construction Revenue
In the renewable energy sector, Nelnet reported solar construction revenue of $42.7 million for the nine months ended September 30, 2024. The company has shifted its focus to commercial solar projects, discontinuing residential operations.
Other Income Sources
Additional revenue comes from various sources, including borrower late fee income, administration/sponsor fee income, and investment advisory services. For the nine months ended September 30, 2024, the breakdown was as follows:
| Income Source | Amount (in millions) |
|---|---|
| Borrower Late Fee Income | $7.5 |
| Administration/Sponsor Fee Income | $4.4 |
| Investment Advisory Services | $4.4 |
Financial Performance Summary
For the nine months ended September 30, 2024, Nelnet reported a net income of $120.9 million, with earnings per share of $3.29. The company is focusing on maintaining a strong operational performance while exploring new revenue opportunities.
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Resources:
- Nelnet, Inc. (NNI) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Nelnet, Inc. (NNI)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Nelnet, Inc. (NNI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.