Checking one IL private college enrollment spin. What has happened to the value of this PA college?

It is the College Financial Health Show with Matt Hendricks and Gary Stocker. Hi everybody. Thanks for making time to join us for what will be the last College Financial Health Show for just 2025. We'll be back in 2026. Both Matt and I are going to run away from all of our broadcasts, I believe, for the next couple of weeks for obvious reasons. And this has been a show we started in August of 2024. This will be our first full calendar year, Matt, of completing that stuff. We have done— we have reviewed the financial health and even viability of some 160 private colleges. I know Matt has some fabulous updates he's done to the app so far. We got some new products both on my end from College Viability and from Perspective Data Science in 2026. Maybe, Matt, we talk about those at the end of the show today, but we're going to two private colleges to wrap up the show, Matt. And who are we talking about?

Yeah, we've got Mercyhurst University in Pennsylvania and McKendree University in Illinois. Um, I'll start with McKendree. I'll share my screen, share the Advanced Compass. Uh, actually, we're just calling it the Financial Compass now, the shorter— financial—

we had some long names.

Yeah, McKendree in Illinois. Cool new feature that you can see. I think this is the first time we've had a show where this pops up, or is it second? Okay, yeah, so here's that pops up for them, um, and I'm gonna go straight to the sort of summary table here and zoom this in so everybody can see as much as possible. So this is a really quick snapshot of the school, and I'll just give you my take on these numbers right away. So the first thing I always do on the show is check, check if the net assets are growing, and pay close attention to unrestricted net assets, and both are growing. Total net assets up 19, almost 20% since 2020. That's good. That's sort of pre-COVID to, uh, today, uh, actually fiscal year '24. I don't have their '25 audit yet. Unrestricted net assets up 80%. That's great, uh, although the level itself— so you want to pay attention to the trend— and the number, yeah, level is shockingly low, $13, $14 million. That's a very short runway if they start running deficits. That's going to be not providing very much headway to get back. And one way to look at it too is how much unrestricted net assets you have relative to your expenses. And you just see like a pretty low ratio there. I don't know if I have that ratio in this 4-to-1 ratio. $14 million is just— I mean, I just know this based on hundreds of these shows we've done. That's a very low number. Although the growth is great, so it's no problem as long as it's growing, right?

Just keep it growing.

Excellent. So operating revenues, this is pretty, pretty normal. Their operating revenues are actually up 5% and $41 million in revenue. That's about normal, although it's not keeping up with inflation. So that's something I'll flag in a graph above in a minute. But I'm going to spend a little bit more time trying to reconcile what's happening with their student revenues when we get there. So expenses are up 3%. That's great. So they're obviously paying attention. Yeah. Keeping their expenses growth in check with revenue growth. That's good. That's a good sign of good management. Change in net assets. So they do have small deficits that are popping up here, which is interesting and a bit troubling, although these are really small deficits. So I'm not going to, you know, freak out or anything. You shouldn't if you're at this school, but these should always be positive. Really, they should be +1% or so. Uh, so in percentage terms, we're looking at, uh, they're down 1, negative 1.75, negative 1, negative 1.74. Again, those are small deficits, but really these should be hovering right around plus 1 every year, uh, or higher. For a school that like this that has no runway, really you should have plus 2 or 3% on your net income margin. So this was the one I was going to flag and focus most on when I was looking through this a bit ago, their net student revenues are down in nominal terms and certainly way down in real terms. So that is— I started looking into this and Googled— I started looking at their enrollment and I'll go into this in a minute. But basically I'm finding conflicting reports of what's happening. They have press releases saying that they're getting record enrollment. Which is not what they're reporting to IPEDS, to the federal government. So there appears to be a conflict between what they're reporting in the media and what they're reporting to the federal government. And I'm leaning towards the IPEDS reports probably are correct that their enrollment's actually shrinking quite a bit because at the same time their student revenues are also shrinking. So your student revenues won't shrink if you're growing enrollment unless your price goes way down. but I can't see exactly what's happening there. They would need to reconcile this. But what's far more important is not the enrollment, as you know, Gary, it's the revenues. And those are clearly going down. There's no question about that. So while they're reporting record enrollments, that's actually not helping them because their revenues are decreasing. So sooner or later—

Matt, you've heard me talk many times about how colleges will spin enrollment. I'm guessing that's what's happening.

Yeah. I tried to— I couldn't see any of the numbers they're reporting in this press release, by the way. This is what they put out. So they've got a great record enrollment since 2017. And I couldn't see that that was true. In fact, their student revenues were actually their highest ever in 2017. So that's kind of an interesting year to pick. So student revenues have fallen since 2017, but they're claiming that they have more students. Uh, compared to going back to then. Uh, I can't see that. I'll show you this. I'll show you right now what I see with their public data. Um, so it's quite possible that they're not reporting consistently or, um, sort of, I don't know, choosing the numbers they share. Yeah, we're being a little bit selective on what they're reporting in terms of the enrollment, it looks like. Uh, but everything else looks pretty good here. These endowment draws look good. Endowment values up 24%. All this looks fine. Um, they do, um, I would just say that, um, I'm not so sure about what they're claiming is the case with their enrollment and sort of implication about their financial health. I don't think it's as strong as they're leading on. So I'll try to make that clear here, and hopefully this makes it a lot more clear to stakeholders that are at the school. So let's start with student revenues. This was initially what I flagged. So their student revenues are decreasing, in fact decreasing faster than their peer set, and this peer set is this one. Again, where does this come from? This comes from when two schools both say that they're peers of each other. So both are confirming that, yeah, we're both peers. That's this list of schools. If they don't have 10 of those, the next step would be to look for a second level. So if you say you're a cross-peer with somebody and then that cross-peer also says they're a cross-peer with another school, then transitivity applies, right, Gary?

Yeah, that's the word of the month, Matt.

That's where we get to the 10. If we can't get to 10 that way, then I look for schools that say, in this case, McKendree is a peer, but McKendree for whatever reason didn't list that school as a peer. But usually we get the 10 on the first 2 iterations. All right, so here's— this is concerning. So just to make sure make sure this is really clear. 2017— since 2016, uh, their student revenues are down 18%. Okay, so it really doesn't matter. Um, I mean, it's irritating to me that the, the reporting enrollment numbers that seem to suggest they're growing when I don't think that's the case. At least that's not what they're telling the federal government. Um, but honestly, it doesn't really matter. What matters the most is this number. 18% down on net student revenues is a very bad result.

That's nominal number, that's a nominal term, right?

Yeah, in real terms, um, they're down 37%. Okay, so very bad results. Uh, doesn't matter what enrollment is, to be honest, but I'll show you what the reports are for enrollment, um, right now. Students. All right, so, so in 2017, they reported FTE students of 25 31, 2,531. That was their peak enrollments. So at least the story does match what I'm seeing here. That was their peak enrollment, but they have not had increases in enrollment since then. They've only decreased and then looks like small increases since 2022. So they are, I wouldn't characterize this as being at record enrollment since 2017. In fact, it looks like their report for FTE students in 20, What is this? 2021 was higher than it is right now. Well, it looks like the same amount. So nothing really— honestly, if you look at this whole context, this is a very bad result for enrollment. Enrollment appears to be down 26% since 2016. So there's not a lot of ways to sugarcoat that. That is a very poor result in terms of enrollment. Again, worse than their peer set here. And it looks like the peer set is also struggling mightily. But 25th percentile of all schools is doing much better than both the peer set and this McKendree. So we often look at the student revenues and wonder, okay, why are student revenues decreasing? Based on the data, which I'm going to assume is correct because that's the statute, right? They have to report accurate data to the federal government or they risk losing their Title IV aid. So I'm going to assume the reports are accurate to the federal government and may not be fully, uh, accurate to the news media. So assuming they have accurate records here, which we can check, uh, happy to work with them and fix this up if the reports to iPads are not right. Um, it happens sometimes. But, uh, we do check the per-student revenues, and it looks like, um, yeah, they have a couple issues. It looks like the price that they're charging per student for full room and board um, or average. Auxiliary is room and board, athletics, all that. Um, and, uh, tuition is just really low, right? And that's one of the things they put in the article, that they sort of maxed out the tuition at $15,000. It may not be a good idea. This is a really low price for a private school. Again, below the 25th percentile. It means 75% of, of private schools are charging more on average for tuition, room and board. So it doesn't look to me like they have really fixed this issue. I mean, the price is really low and has been forever. So it looks like the, the reason their student revenues are, are lower is because actually the real enrollment is actually lower, just like I just showed you. So it looks like their net student revenues are decreasing mostly because of, again, what I just showed you. Their FTE student count is far lower. It's down about 26%, and it's actually been offset a little bit according to this data, offset a little bit with the price going up a little bit. So, um, yeah, the story that is in the media does not appear to match the reality of what is showing. So here's my advice, um, if you work at this school, you're a board member or whatever, ask about this. We need— you need to figure out Why the mixed messaging? And honestly, it doesn't really matter at the end of the day what the enrollment is. You need to focus on the student revenues, which are low and getting lower. And that is a problem, although they are improving slightly recently. It's— yeah, this is not a good outcome.

They're still below the 25th percentile in terms of percent change.

This is among the worst in the country. Normal would be growing your student revenues by about 6% or so. So that's still a poor result. As you know, higher ed is struggling for student revenues, but it's been mostly offset by really, really strong market returns. So endowment growth has really sustained a lot of schools far beyond any loss in student revenues.

Is that the case for McKendree?

I don't think so for McKendree. Uh, oh, maybe. Let me see. Let's— because honestly, there we saw that their operating revenues were up, right? 1% change. Actually, no, we took a really selective sample here. Since 20— uh, what was it? Since 2020, they're up a little bit, but, uh, overall their operating revenues are down 5% since 2016. Honestly, I think the main takeaway here is that this really positive enrollment results, you need to ask questions. This is irrelevant really. What's happening is their revenue's decreasing. Yeah. It looks that their enrollment is actually decreasing. Their student revenues are clearly decreasing. So lots of issues potentially, although they have been able to maintain mostly balanced budget They just have a tiny runway. So yeah, there's reason to ask questions and make sure that, you know, that continues to be the case, that you're growing your unrestricted net assets. Was there anything else that I should talk about, Gary?

I mean, like, bottom line, check on their endowment to see if they have been— what the endowment looks like. And we saw the draw was pretty low, but it has grown.

Yep.

The quick snapshot.

Yeah, they have a tiny endowment too. It's only $40 million right now or so. It's grown since 2020 at 23%. The appropriations look mostly normal, although they're back here. This was odd, uh, that's right around COVID. They were taking a lot of money out, as I recall. The average did. So let's take a look. Endowment.

Yeah, because the median endowment has grown something like 55% since 2015.

So this puts it all in better context. Even I get fooled by the context, right? So, um, Yeah, so we were just looking at a snapshot, snapshot there from 2020 to '24, and that's actually the best possible view we could have had of their endowment. Their endowment's actually not doing well. It's only up 12% since 2016.

That's not good at all. That's not good.

Terrible. And in real terms, their endowment is down 14%. Okay, so if there's only one thing that people get from this show, from McKendree, is just you need to start asking questions. Uh, things are not is, um, great as some of these press releases I've seen make it out to be. And so there's actually a pretty shockingly poor performance for the endowment, and it's probably because of massive draws back here for the most part. Let's double-check that. Bunch of big draws. Yeah, we have some big draws, uh, in 2020 Which is weird, uh, actually a lot of schools were taking small draws in 2022. That's the year after they got all that COVID money. Yeah, okay, so we've got big, big, big, big, our normal, normal. Okay, so we had 3 years in a row with really big draws on the endowment, which is surely accounting for the— yeah, most of the, the sluggish performance over since 2016, probably. Um, So, uh, we could check returns as well. Let me just double-check that, uh, return. Okay, poor returns here on 1 year, but mostly looks good. You see the tight band? I think we've shown this on previous shows, but it's really not a lot you can do with your endowment to grow it faster than other schools unless you're going to take weird risks with your investment portfolio. They pretty much all move in a really tight band. Um, so you're at the mercy of the market. The biggest difference, uh, across schools is the appropriations, right? There's a wide range in how schools are drawing on their endowments. Yeah. And, uh, McKendree certainly drawn more than normal. Um, and I flagged that actually here with this average, but I'm actually missing the worst year here, which was— well, I have that one.

Yeah, you've got that.

I do have it. I do have most of the bad years there, but, um, Yeah, a bad— a big draw of 9.5% in one year is going to pull you down quite a bit. All right, uh, I hope that's clear. Um, I could— we could go into some more, uh, suggestions. I ask— I say you should ask questions about what's happening at the school. Um, let me just check some of their operational metrics here and see what might be going on in terms of any efficiencies potentially to look at. All right, so a little bit high. Their peers have problems. I mean, that's a big step. Okay, so they're, um, a bit high on staff count here. Let's look at, um, compensation. Non-officer salaries and wages— this is a big expense item. That looks fine. Yeah, looks good. Contractors Okay, check contractors if you're at this school. The number of contracts looks pretty high. Advertising looks low, actually. Could be one issue. IT spend is certainly going to be high. Check your IT spend. We'll check if they have a contractor there in a second. Uh, check IT insurance. Wow, what's up with insurance? That's way too high.

We see that, we see that way a lot of times. I don't know what's going on. If it's health insurance issues, that what that category covers, Matt?

Um, I think this is not health insurance. Okay, I may be wrong about that. Uh, this needs to be looked at, and it's weird too how it bounces around, so it could be errors in reporting too. Fundraising expenses, that looks okay. Um, fees for services, yeah, okay, we still— so it's clearly something up with the vendor spends. Let's see if we can identify some specific vendors for them to look at. The vendor table. I just feel like I don't want to go on without giving them some things to look at here. All right, lots to look at. Okay, this food service contract's a bit high, uh, $1,800. Certainly not as bad as we've seen for, um, many, but, uh, you can do better than that usually, and that's high for your revenue and size. IT contract Okay, we got 2 IT contracts in the same year. Certainly the combined value of these is too high, so check your 2 IT contracts. Um, they may be switching, or no, they have got Collegiate and Ellucian at the same time for several years. That's not normal.

Check that.

This contract's also— that's food service again. Okay. Uh, all right, so check your IT contracts. Your transportation contract and food service contracts. Looks like they have— that can't be facilities and food. That— or maybe it is. If it is, then something's up still. There's no way. I can't imagine you can do food service for $1,800 plus facilities. If you can, then they're getting a great deal. But yeah, double-check these. And overall, honestly, the number of contracts was really high. So— and we also saw fees for services is really high, so there's probably a ton of other contracts here that are not good that, um, I can't see, right?

Because the 990s only grab the top 5, right?

Yep, yep. All right, I'm going to move on to the next school then. So hopefully that's helpful for those people at McKendree. Let me see Mercyhurst. Mercyhurst University, again we pop up with a peer set, and let's go right down to this snapshot here. Okay, so the C of this school is compared to what we just talked about, McKendree. They have $66 million in unrestricted net assets. Uh, although it's decreasing fast. All right, that is, uh, that's alarming. A decrease of 9% in just 5 years in unrestricted net assets. Again, that's nominal, shouldn't be happening. The school really should be managing, targeting a positive unrestricted net asset growth every year. Uh, same with total net assets, just stagnant. So I'll show you the context for that in a second. Operating revenues are down a ton. This is a lot of alarming stuff here. Operating expenses are down, but not as much as revenues. So they're probably running deficits. Yes, big deficits. 7% net income loss.

Yeah.

2 years in a row. Uh, sorry, 7.5%, 8% net income loss. This is millions. This is $6.5 million loss in '23. $7 million. So they've lost almost $14 million in 2 years in net assets from operations. So less than ideal. Um, net student revenues are down 13% in just 5 years. So again, really bad. CapEx to depreciation, uh, this looks okay. Average is at 1. That's really where you want to be, I think.

I don't see that very much.

Yeah, I can't— I, I don't know if I even looked at that with McKenry, but double-check your facilities spend. All right, the rest, let's see, normal endowment draws, the endowment's small. All right, okay, I think we have some similar things to look at here. So what I want to, just based on the snapshot, let's take a look at net assets shrinking, revenues shrinking, see if we can identify what's happening. Student revenues are way down, it's probably enrollment drops. But let's take a look from the top here. Net assets. I'm going to focus on unrestricted net assets, percent change. Again, this is why this is so useful. If you're a board member, you need to see this graph. All right. This is— your peer set is normal. Your peer set's doing perfectly fine. This is exactly what you'd expect to see from a normal school with unrestricted net asset growth since 2016. And you're not at all normal at Mercyhurst. You guys have decreased your unrestricted net assets by 5%. In real terms, you're down 27%. Okay, so you're falling further behind this peer set every day, um, and it's not good. All right, so, and same with net assets. I think net assets were actually looking better, but still, um, not, not good. Um, so there's total net assets again, up just a little bit. Yeah, your peer set looks normal. Everything's— you should try to be like your peers here. and you're falling behind them. In fact, again, this is the 25th percentile right here for net asset growth. Not good. Running some big deficits here. I think that's the issue. Um, so we'll look at net income margin. All right. Yes. All right. So we have 2 years in a row of really big deficits. See how the peer set always keeps above zero for the most part, uh, except for 1 year, but that was I think a lot of, a lot of schools are spending down all this surplus that came from COVID Um, so the peer set looks great. That's what you should try to do. Mercyhurst is not doing that. They're down 7% net income deficit, 8% here. Um, in millions, it's, uh, what I already showed you, that's similar in terms of millions. Um, okay, so let's take a look at the revenue side. Operating revenue. All right, just to give you a sense again, again, if you're a board member and you see this, that your operating revenues are shrinking fast.

This is nominally, not in real terms.

Yeah, that's a sharp drop in operating revenues from '22 to '23 and '24.

What's that look like adjusted for inflation, Matt?

Yeah, let's adjust this for inflation. We're down 3%. All right, yeah, even honestly, the peer set's not doing great here, although they do a good job of keeping a balanced budget. They certainly are struggling as well with operating revenue changes in real terms. In nominal terms, they're up quite a bit. All right, uh, all right, so let's— we're gonna look at student revenues, um, because that was alarming in the snapshot I showed you below. So yes, Student revenues are down 10% nominally, adjust for inflation, down 31%. All right, so not great there. I'm going to go back to— let's do per student values. All right, so there's a couple things here. Remember, student revenues change by both price, so you're talking net tuition and net auxiliary revenues. They usually don't get scholarships for housing, so, or not very big, so It's really housing, room and board, and net tuition we gotta focus on here. And you see that per student, the price is way down. All right, so that's gonna definitely put pressure on the overall net student revenues. By the way, I don't know if you saw that, I selected per student. So really it's a good sense of like what's the price to go to the school and on average live on campus. Uh, it used to be $26,000, now it's $18,000. Yes.

And you know, Matt, that would be like you and I buying a car for $26,000 in 2016, buying the same car for $19,000 in 2024.

Yeah, it's a sharp drop in the, in the price here, average price. So there, I want you to be aware, it's, um, this could be a good proxy for the price, but there can be other things if they launch like an online program or something and charge way less for that. I've seen that before. You lose all of your international students, that will tend to do this as well. So you need to investigate that, and we do that with our clients, figure out exactly what's going on. But let's take a look if there's also an enrollment loss or if it's all about prices. Students, percent change. Wow, this looks really weird. Okay, um, we've got a surge in enrollments That's when the price went down.

That's when the price went down, I think.

Yeah, I wonder if they did do some kind of online thing, right? They go from $26,000, all of a sudden $30,000, and then back down again.

I wonder if they didn't launch some kind of online thing here, or tuition reset even.

Yeah, they got a bunch of students and then they lost them. So they're really— this student's, uh, number is flat, but the price they're paying is less than what they used to pay. So that's really the story. It's all about price here. They got the same number of students, but they're paying less. So they need to figure out why that's the case. And, you know, like I said, it could be some kind of online thing. Maybe they lost all their traditional students or a lot of them, and they're now online mostly, keeping the FTE students sort of flat, but they pay way less, right?

So hey, man, talk about, talk about how the Strategic Compass could help Mercyhurst.

Yeah, yeah, well, we can basically answer all these questions that I'm asking right now. That's what we do with the Strategic Compass. I can see, we can see together really quickly what's happening with the student composition and what could be happening with the price. If it's actually a change in net price, we can see that and fix those kinds of errors before they go on too long.

And you do comparisons, right? You do comparisons with peers.

Yeah, we could— in this case, they would need to compare, and I could do it on Strategic Compass, their net, um, net price for a student to live on campus full-time, um, to their peer competitors, right? That's the best way to do it. And we can find their peer— they probably already have a list of peer competitors, but we get that from the Clearinghouse, um, so we can dig down into all that. So they have, they have deficits, right? So clearly need to do something to fix that fast. Again, they don't— they have a longer runway than McKendree, but still not great. $66 million. And a lot of this is probably buildings, right? And as far as I've heard, banks are not super keen about writing you like a home equity type of loan so you can pull cash out of your buildings, just because these are specialized buildings in a lot of cases. Uh, banks don't want to do that.

They may have already collateralized some of those as well.

Yep. Um, so how can they balance their budget? Let's go into the operational stuff again. And like I said, on the revenue side, they really need to look at why the price per student is so much lower. And that's just the basic question that a board member should be asking, if they haven't already, to understand why that's happening and to understand if there's any policies that they can adopt to fix that. All right, so per student employee numbers, these are not the worst I've ever seen, but they are a bit high. So hopefully they understand that the employee count is a bit high, um, and we can help them investigate that with the Strategic Compass. It's one of the main benefits of the Strategic Compass to find exactly where the high staffing counts are, or salaries look weird. Um, that looks okay. That's number of employees over $100K. Uh, contractors, very low on contractors, so that actually can be an issue, right? So if you don't have a lot of contractors, you tend to have a lot of staff. So there's an optimal mix in the middle. Um, yeah, but, uh, let's take a look at Contract. I wonder if this compensation for non-officers is going to be an issue. Nope, that looks weird. Or student. Okay, that's actually low non-officer wages. Uh, yeah, it's— I'm not seeing a clear story like I usually do with these. It looks like they're low on staffing and vendors, but yet they have deficits. So let's see if we see something in any of these. Advertising looks fine. General taxes. Yes. Okay, here's one problem. Yeah, IT spend is incredibly high. All right, so they almost certainly did some kind of online thing, I would guess. But it's not like a sudden sharp increase, so I don't know. This, this needs to be looked at. That's— you're spending $1,500 per student on IT. That's really, really high. Um, that's really high. Um, so that's one of the issues. Insurance. Wow. Okay, I guess it's okay. All right, insurance. So IT is the big one. Fundraising, travel. I'm just going through all these. You can do this yourself. Uh, fees for service.

For those watching the show and seeing Matt go through this, the fee for the annual subscription fee is just $219. You got it.

Yeah, you can get this for $200 and you can get on the right course. This is really the first step to making good policy at your school. Honestly, it seems really silly and simple, but it's groundbreaking. Helps get everybody on the same page of what's happening. So you can really clearly see they have an issue with vendors here. It's not the number of vendors. They must have a massive IT contract. You see this fees for service spent per $1 million? This is way out in no man's land.

Could be the top 5% in the country or something.

All right. Yeah, hopefully the story stays consistent here. Let's check their— their vendor spend, the actual contracts themselves. So Mercyhurst. All right.

There we go. Maintenance.

Yeah, we got a— okay, we got lots of issues here actually that are not all IT related like I was expecting. But we do have IT. Again, 2 IT contracts in the same year. I don't see that ever. And we've got 2 schools on this show with that case. Okay, so 2 IT contracts, same time. Not normal. And if you added these up, those IT spend— that IT spend is really high. Okay, the food service, $3,300 per student is insanely high. Okay, uh, so again, this needs to come down to like $1,700, $1,800 per student usually. Um, so this is not the first time I've seen Parkhurst with a really high price, right? I remember that show we did a few times. Yeah. Yeah, the owner of this is on the board of the school.

I can't remember the college.

Yeah, yeah, I was like, come on. All right, um, maintenance. Okay, everything else looks good. So you got your food service contract, maintenance contracts to check. Both of these are high. Uh, in fact, you could probably have Aramark do both the maintenance and dining for close to what they're spending on just the maintenance, but double-check that. Maybe slightly higher. All right. And then the IT, you got 2. So there you go. We find it eventually, right? It wasn't the number of contracts, not the number of staff. It's just we have really high contracts, particularly in IT and food service and maintenance. So there you go. There's a smoking gun for you to start digging at. I'll pass it back to you, Gary.

So, you know, Matt, we know from looking at the data that most of the colleges review, we have— we tag them and we tag the leadership on those colleges. And in almost all cases, but not every case, we know they watch the show. All right, so for the folks either at McKendree or Mercyhurst or any of the other 150-plus colleges that we reviewed— and Matt and I have done this on occasion— you're welcome to join us on the show if you have questions about the data, if you want to challenge our analysis. We're happy to have you on the show. We'll be nice, we'll be polite, we'll be respectful. You're welcome to join us. I bring that up because the folks at McKendree— and there's nothing wrong with spinning data, we all do it, all right? That's the nature of higher education, that's the nature of everything in modern culture. But you have an obligation to your students, to your stakeholders, to actually look at the real impact. Spin it any way you want, but Matt and I are here in large part because we're taking your data, we're taking your data from your audited financial statements, from your IRS forms, from your iPads data, and just sharing and comparing it. So the good folks at McKendree, the good folks at Mercyhurst, you're welcome. Drop me a note. My contact information will be on the show notes. We'll be glad to either talk to you offline or bring you on the show. And you're welcome to say, hey, here's why we are saying that. We'll be happy to share that data with you. And Matt, very briefly, I think what I'm going to look at today is, um, I'm going to look at the, uh, what's called unfunded institutional grants. So this is a 2025 College Viability App, and, uh, we'll start with 4-year graduation rates because Matt would be really disappointed if I didn't start with that. And we have, we have Mercyhurst doing well. They're graduating more than half their students. McKendree, they may say they're enrolling more students, Matt Hendricks, but they're not graduating very many of them. But let's take a look at something called unfunded institutional grants. And it's called institutional grants unfunded. And Matt, of course, you and I know that as discounts for the most part. And they're typically called merit aid. They're typically called the presidential scholarships, those kind of things. So I would expect to see McKendree go up a lot. All right, not necessarily the case. Their unfunded discounts are up about $2 million, $2.5 million in the last 8 reported years. Many colleges are a lot worse than that. Interestingly, Mercyhurst has been giving away the store increasingly.

Yeah, we saw that their price dropped out.

Yeah, yeah, because they're, they're the tuition discounting to get students in the door is growing. So it's an interesting observation. You know, if the folks at McKendree, at Mercyhurst want to chat with Matt and I, we can give them some deeper looks with the Strategic Compass and other tools. But I would have expected this to kind of be reversed. So that's an interesting, interesting comparison on that. And I just want to take a quick look at tuition and fees. Okay, and again, McKendree is down $7 million, Mercyhurst is up $4 million over the last 8 reported years. So that's again IPEDS data. Matt's using a different resource than I do for that, for that kind of numbers. But again, we see this regularly. And the last thing I want to take a second to look at is we also have tools that show us where you are in terms of internal market share. We do external market share as well. We're not going to do that today. And these are all the bachelor's degrees at McKendree University from 2020 through 2023. And what I want to point out for both McKendree is look at all the low enrollment numbers. About half of their majors in this list, we have 64 majors we track in the 2025 version, it's going to be about 3 times that. In the 2026 version. But look at all these low-enrollment majors. Same thing for Mercyhurst. Look at all these low-enrollment majors. And Matt, I know you've heard me say this, but for those that don't watch me every week, don't listen to me every week, this is the year— and I, I know Jeff Slingo said this earlier in the year— this is the year when colleges will realize they cannot be everything to everybody. And we're seeing that on the public front as well. On yesterday's podcast on This Week in College Viability, Oklahoma is the latest to join the group of public entities saying, hey, if you don't have a lot of majors enrolled, you can't offer that course. And so, Matt Hendricks, how many times in the course of the 160-plus colleges we've covered have we seen a chronic inability to manage expenses in the context of revenue? Matt, it is a preponderance of times.

You can see how it happens though, right? Like they're press releasing, oh, record enrollment, you know, uh, you have to ask questions, right? Then the, the simple question is, if we have record enrollment, why is our student revenue near record lows, right? Like, let's start having that conversation. If you don't ask that question, nothing happens. And, and then, and then people are, quote, shocked, um, you know, 5 years down the road when the place closes. Or I'm not saying McKinley's gonna close, but you know, that's how it happens over and over again.

Um, and I, I hope slowly and then all of a sudden is the line that's used.

Yeah, I hope, I hope this data helps people see the questions to ask. Uh, it's just obvious, right? Um, you shouldn't be able to sort of, uh, you know, give a narrative that's not in reality and have nobody ask questions, right?

Yeah, yeah, it's a good point. So, so let me wrap up the final show of 2025. And, and Matt, you've heard me say this before, and I always draw the connection between the Moneyball era. Major League Baseball in the early 2000s were the first to use data to make themselves better. And what Matt Hendricks does, what Gary Stocker does, and very few others, is we look at the data. And it is the data colleges themselves submit through their financial statements, through tax forms, and through the National Center for education statistics. Matt and I just use our respective skills to note the comparisons, and you saw Matt with his percentiles. College leaders, students, families, board members, community leaders, media, if your trend is bad, don't tell us you can fix it in one year. Matt, you know, I've talked about that before because you can't. You can try and spin it any way that you want, but the data is out there And in 2026 and beyond, probably not just Matt Hendricks and Gary Stocker are sharing those observations, but many, many others as well, Matt, are following the lead that you and I have started and starting to task these colleges by looking at their finances. So, Matt, it has been a pleasure these last 18 months. We'll wrap up our first full calendar year. I wish you and your family the best of holidays. And to all of our listeners, thank you very much for making time to watch either the live version or the recorded version of the College Financial Health Show. With Matt Hendricks and Gary Stocker. We'll be back in early January.