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JSM, Navient Corporation
Revenue is Government Services (68%) and Healthcare Services (32%).
We provide this Core Earnings basis of presentation on a consolidated basis and for each business segment because this is what we review internally when making management decisions regarding our performance and how we allocate resources.
Segment Results" for a discussion of the primary contributors to the change in Core Earnings between periods. 2025 GAAP and Core Earnings results included the following significant items: $280 million provision for loan losses ($249 million for Consumer Lending and $31 million for FFELP).
The business
What it sells, where the money comes from, the kind of company it is.
Next report By 11/8 · the 10-Q for the quarter ended late September · due within 40 days of period end · has filed ~30 days after · the wire records it on arrival
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- What it is
- An asset manager, paid a fee on the money it runs for other people.
- What moves the needle
- Assets under management and the fee rate on them. What decides it: net flows in or out, the market's move on the assets already there (the firm rises and falls with the indices it invests in), the drift toward cheaper passive products, and the operating leverage on a largely fixed cost base. On its own account, the filing leans hardest on concentrated dependence, set against the numbers in what the filing emphasizes, below.
- Is it a good business?
- Operating margin has run at the high end of fee-business margins across the record (median 1087%, above 25% in 7 of 7 years), the economics of a business that takes a cut without carrying the risk. It earns this on little capital, so return on equity has run near 17%, the leverage of a model that needs almost no plant to grow. A high return that does not fade can mark a moat, but whether the assets stay (net flows, not last year's market) is what the flow disclosures and the 10-K settle, not the multiple.
Every line is arithmetic on the company's filings, shown in full in the sections below.
Where the money comes from
read the 10-K →Government Services is 68% of revenue, with Healthcare Services the other meaningful line at 32%.
- Government Services68%$183M
- Healthcare Services32%$88M
- Federal Education Loan Asset Recovery Services0%$0
From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.
The record
Ten years of arithmetic, read across the cycle.
The record, 2018–2024
realized figures from each filing · older years to the left| 2018’18 | 2019’19 | 2020’20 | 2021’21 | 2022’22 | 2023’23 | 2024’24 | TTMTTMDec 2024 | |
|---|---|---|---|---|---|---|---|---|
| Income statement | ||||||||
| $359M | $391M | $388M | $507M | $332M | $321M | $271M | $271M | RevenueRevenue |
| n/m | n/m | 664.4% | 444.2% | 882.2% | n/m | n/m | 862.7% | Operating marginOp. mgn |
| 110.0% | 152.7% | 106.2% | 141.4% | 194.3% | 71.0% | 48.3% | −18.1% | Net marginNet mgn |
| $528M | $763M | $532M | $936M | $827M | $313M | $174M | — | Pretax incomePretax |
| $395M | $597M | $412M | $717M | $645M | $228M | $131M | ($49M) | Net incomeNet inc. |
| 25% | 22% | 23% | 23% | 22% | 27% | 25% | — | Effective tax rateTax rate |
| Cash flow & returns | ||||||||
| $10.4B | $7.5B | $6.4B | $6.7B | $10.6B | $7.4B | $8.5B | — | Investing cash flowInv. cash |
| ($10.9B) | ($10.0B) | ($7.7B) | ($7.3B) | ($9.7B) | ($10.0B) | ($9.6B) | — | Financing cash flowFin. cash |
| $616M | ($1.5B) | ($244M) | $41M | $1.2B | ($2.0B) | ($690M) | — | Change in cashΔ cash |
| 11% | 18% | 17% | 28% | 22% | 8% | 5% | -2% | Return on equityROE |
| 7% | 13% | 12% | 23% | 19% | 5% | 2% | −4% | Retained to equityRetained/eq |
| Balance sheet | ||||||||
| $104.2B | $94.9B | $87.4B | $80.6B | $70.8B | $61.4B | $51.8B | $51.8B | Total assetsAssets |
| $1.3B | $1.2B | $1.2B | $905M | $1.5B | $839M | $722M | $2.1B | Cash & investmentsCash+inv |
| $100.6B | $91.6B | $85.0B | $78.0B | $67.8B | $58.6B | $49.1B | — | Total liabilitiesTotal liab. |
| $28M | $13M | $14M | $11M | — | — | — | — | Noncontrolling interestsNCI |
| $3.5B | $3.3B | $2.4B | $2.6B | $3.0B | $2.8B | $2.6B | $2.6B | Shareholders’ equityEquity |
| Per share | ||||||||
| 264M | 233M | 195M | 172M | 144M | 123M | 111M | 95.0M | Shares out (diluted)Shares |
| $1.36 | $1.68 | $1.99 | $2.95 | $2.31 | $2.61 | $2.44 | $2.85 | Revenue / shareRev/sh |
| $1.50 | $2.56 | $2.11 | $4.17 | $4.48 | $1.85 | $1.18 | $-0.52 | EPS (diluted)EPS |
| $0.63 | $0.63 | $0.63 | $0.62 | $0.63 | $0.63 | $0.63 | $0.64 | Dividends / shareDiv/sh |
| $13.33 | $14.32 | $12.48 | $15.10 | $20.67 | $22.44 | $23.79 | $27.80 | Book value / shareBVPS |
| 6-yr | 5-yr | |
|---|---|---|
| Revenue / share | +10.2%/yr | +7.8%/yr |
| EPS | −3.9%/yr | −14.4%/yr |
| Dividends / share | +0.0%/yr | −0.0%/yr |
| Book value / share | +10.1%/yr | +10.7%/yr |
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
Is it a good business?
- Operating margin 914.4%Wide fee margin (≥30%)Operating income $2.5B ÷ revenue $271MIndustry peers: median 25%
What this means
The heart of a asset manager: how much of each fee dollar survives the cost of running the business. Fees ride on assets under management, so the swing factors are net flows in or out and the market's move on the assets already there; the cost base is largely fixed, which lifts margins in a bull market and squeezes them in a bear one. A high margin held for years, through a market it does not control, is the operational mark of a real franchise.
- Net margin −29.5%SlimNet income ($80M) ÷ revenue $271M
What this means
What reaches the owner after tax and interest. For a capital-light fee business this should be a wide share of revenue; when it is thin despite a high operating margin, debt taken on for acquisitions is usually the reason, so read it next to the balance sheet.
- Return on equity −3%Below the cost of equityNet income ($80M) ÷ equity $2.6BIndustry peers: median 6%
What this means
Because the business ties up little capital, a healthy fee stream throws off a high return on the equity behind it. Read it with the buyback record: returning capital lifts this ratio honestly, but heavy debt taken to do so can flatter it.
All figures as filed; the source filing is linked above.
Management, ownership & pay
read the proxy →From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.
| Fiscal year | Pay, as filed | “Actually paid” | Net income |
|---|---|---|---|
| 2021 | $7.9M | $23.8M | $717M |
| 2022 | $8.3M | −$533k | $645M |
| 2023 | $12.1M | $10.5M | $228M |
| 2023 | $5.1M | $6.3M | $228M |
| 2024 | $6.1M | $2.1M | $131M |
| 2025 | $5.5M | $4.4M | — |
Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Net income is the whole business's, as filed, for the same fiscal years.
- Insider ownership33.8%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
- CEO pay ratio40:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
- Stock-based compensation$21M
The slice of the business handed to employees in shares in fiscal 2024, 7.7% of revenue, equal to 0.8% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.
What an owner would ask, FY2025
read the 10-K →- Which reported numbers are a judgment call?Management names Credit & receivables as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →
The questions the record and the charts do not answer on their own; each carries the figure and the place to look.
Peers
Navient Corporation is listed here as a claim on a business rather than as the business itself — a preferred series, a bond or a warrant, filed under the same registrant as the common stock. A comparative table lines businesses up against one another, so there is none here. The business behind it is Navient Corporation (NAVI), where the record, the scorecard and the peer bench are.
The price
What a price has to assume.
What the price implies
reverse-DCFThe owner-earnings base could not be formed from this filing’s tagged data (operating cash flow or capital spending is missing), so the owner-earnings reverse-DCF has no base to grow. We read the price from both ends instead: type a price to see the profitability it demands, then set the mature margin you would believe and weigh the two against each other. Nothing leaves your browser unless you enter it in your notebook.
Revenue, delivered−8%/yr’19→’24
Enter a price to run it.
A dated snapshot of the price you typed, the assumptions you set, and what the page showed for them. A snapshot is never edited after it is saved. Your notebook is yours alone — the commitment states what is stored and what we will never do.
Two reads of one future. From your price: the owner earnings the company must reach, valued at a mature multiple and discounted back at your rate, expressed as the margin it implies on revenue grown at your rate. From your belief: the mature margin you would credit, set on the dial above. When the margin the price demands runs above the one you would believe, you are paying for a future taken on faith. For a deep cyclical at a trough, normalized through-cycle earnings are the better lens; this mode is for the genuinely unprofitable, and for the profitable business whose capital spending currently outruns its cash.
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Industry order: ← JHG the Capital Markets & Asset Management chapter KEEL →