EdTech Unicorn Stride Surges: Strong Financials Fuel Rally!The EdTech revolution is progressing rapidly! As technology advances, internet access grows swiftly, and students seek innovative learning methods, the global EdTech market is flourishing.
North America currently holds a significant 37.3% share, but regions such as the Middle East and Africa, Europe, and Asia-Pacific are gaining ground, fueled by government support, digital literacy, and a burgeoning middle class. It's an exciting time for digital learning, and there's even more to look forward to!
◉ EdTech Market Growth Outlook
➖ Valuation projected to rise from $220.5 million in 2023 to $810.3 million by 2033.
➖ Compound Annual Growth Rate (CAGR) of 13.9%.
◉ Government Initiatives Supporting EdTech Sector
The US Department of Education has allocated $277 million in new grants through the Education Innovation and Research program to enhance educational equity and innovation, particularly in areas affected by the COVID-19 pandemic, specifically focusing on STEM education and rural regions.
Recognizing the enormous opportunity in EdTech, we're examining a stock that exhibits remarkable growth potential within the sector.
◉ Company Overview
Stride Inc. NYSE:LRN is a tech-driven education service provider offering proprietary and third-party online curricula, software, and services in the U.S. and globally. Their products support personalized learning for K-12 students through virtual and blended public schools, individual online courses, and supplemental materials in subjects like math, English, science, and history. Stride also emphasizes career learning in fields such as IT, healthcare, and business, and operates tuition-based private schools. Additionally, they provide post-secondary programs in software engineering and healthcare under brands like Galvanize and Tech Elevator, along with staffing services. Rebranded from K12 Inc. in December 2020, Stride has been incorporated since 1999 and is headquartered in Reston, Virginia.
Investent Advice by Naranj Capital
Buy Stride NYSE:LRN
● Buy Range- 77 - 80
● Target- 115 - 120
● Potential Return- 45% - 50%
● Invest Duration- 12-18 Months
◉ Market Capitalization - $3.31 B
◉ Peer Companies
➖ Graham Holdings NYSE:GHC - $3.23 B
➖ Adtalem Global Education NYSE:ATGE - $2.67 B
➖ Grand Canyon Education NASDAQ:LOPE - $4.04 B
➖ Laureate Education NASDAQ:LAUR - $2.25 B
◉ Technical Aspects
● Monthly
➖ The stock price initially faced resistance at $40 in 2011 but later found support at $17.
➖ Despite several attempts to break through resistance, the stock experienced significant declines.
➖ However, after a 12-year period, it finally broke out and rallied to a high of $84.
➖ Currently trading at $77.7, the stock is expected to continue rising in the near future
● Daily
➖ The daily chart indicates a clear uptrend in the price movement.
➖ An ascending triangle pattern has formed, and following the breakout, the price has retraced to the breakout level.
➖ At this moment, the price is attempting to find support at the 50 EMA.
➖ From a technical standpoint, the stock is resting at a support level, making it an attractive option for accumulation with a mid to long-term investment outlook.
◉ Relative Strength
➖ The chart clearly illustrates that Stride Inc. has greatly outperformed the US Smallcap 2000 index, achieving an impressive annual return of 82%, which is a notable achievement.
◉ Revenue & Profit Analysis
● Year-on-year
➖ In FY24, revenue surged by 11.3%, reaching $2,040 million, up from $1,837 million in FY23.
➖ EBITDA saw a substantial boost, climbing to $295.3 million in FY24 compared to $225.2 million the previous year.
➖ The EBITDA margin also experienced growth, rising to 14.47% from 12.26% in FY23.
➖ Additionally, diluted EPS witnessed an impressive increase of 57.91%, jumping to $4.69 in FY24 from $2.97 in FY23.
● Quarter-on-quarter
➖ In the latest June quarter, the company achieved a remarkable milestone with quarterly sales reaching an all-time high of $520.8 million. This marks a 3% increase from the $504.9 million recorded in the March quarter and a significant 10.75% rise compared to $470.3 million in the same quarter last year.
➖ EBITDA declined from $100.2 million to $82.3 million in the latest quarter, representing a 17.8% decrease.
◉ Valuation
◉ PE Ratio
● Current PE Ratio vs. Median PE Ratio
➖ The present price-to-earnings ratio for this stock is 16.2x, which is considerably below its four-year median price-to-earnings ratio of 18.9x times, indicating that the stock is currently undervalued.
● Current PE vs. Peer Average PE
➖ The stock presents a favorable valuation when considering its Price-To-Earnings Ratio of 16.2x, which is lower than the average of its peers at 18.3x.
● Current PE vs. Industry Average PE
➖ Stride appears to be offered at a more competitive price, featuring a Price-To-Earnings Ratio of 16.2x, which is significantly below the average of 19.2x for the US Consumer Services industry.
◉ PB Ratio
● Current PB vs. Peer Average PB
➖ The present PB ratio in relation to the average PB of peers indicates that the stock is somewhat higher, with a ratio of 2.8x in contrast to the peer average of 2.6x.
● Current PB vs. Industry Average PB
➖ When comparing the current PB ratio to the industry average, Stride appears to be considerably overvalued, exhibiting a PB ratio of 2.8x, while the industry average stands at 1.6x.
◉ Cash Flow Analysis
➖ The cash generated from operations has experienced substantial growth in fiscal year 2024, increasing to $278.8 million from $203.2 million in fiscal year 2023.
◉ Debt Analysis
➖ Stride has a total debt of $528.2 million, resulting in a debt-to-equity ratio of 0.44.
➖ The company generates sufficient interest income to exceed its interest expenses, indicating that interest payment coverage is not an issue.
◉ Top Shareholders
➖ BlackRock Inc. holds a significant ownership interest in this company, with a notable stake of 14.9%. This level of investment reflects BlackRock's confidence in the company's potential for growth and profitability.
➖ The Vanguard Group also maintains a considerable presence, owning 10.7% of the company's shares.
➖ Together, these two investment giants represent a substantial portion of the company's equity, indicating strong institutional support and interest in its future performance.
◉ Conclusion
Upon examining Stride Inc.'s financial performance, we focused on essential metrics such as revenue growth, profit margins, and the stability of cash flow. Additionally, we assessed the company's future growth potential by looking into industry trends and the competitive landscape.
As a result, we are confident that Stride Inc. is positioned to capitalize on new opportunities while effectively navigating challenges, making it an attractive option for both investors and stakeholders.
LRN trade ideas
4/23/24 - $LRN print4/23/24 - $vrockstar - print looks like a beat even if stock has rallied. FCF yields decent, growth "there". has some short interest that will need to cover the bum on a beat which provides liquidity out of the trade. the only print i'm trading long here today. let's see. small size.
STRIDE +5%Stride, Inc. (formerly K12 Inc.) is a for-profit education company that provides online and blended education programs. Stride, Inc. is an education management organization (EMO) that provides online education designed as an alternative to traditional "brick and mortar" education for public school students from kindergarten to 12th grade (hence its former name), as well as career learning programs. As of 2012, publicly traded Stride, Inc. was the largest EMO in terms of enrollment.
Mean reversion buy on earnings crash of $LRN $LRN has been trading in a bullish channel for over a year now, and now is retesting the lower end of the channel's support. I'm entering a long position as the previous two candles were a doji and inverted hammer, both being strong signs of reversal. Additionally, at open, the stock gapped down below the lows on both the previous two candles, giving a good risk/reward ratio for this trade. I'm aiming to sell when the price crosses back to the moving average 50, for a small swing, but will cut my losses if the price falls below ~33.17, around where the previous trough's low was.
LRN, a Nice VCP Breakout that its not from the energy sectorNice VCP pattern on an industry that is not Oil & Gas. Bought a small pilot position(6.8K,1.3%,500 USD Risk, my full defensive position to nibble in a tough market) to see if I can get traction on the terrible market which shows narrow leadership outside Energy. Looking for the opportunity of a bear market rally from here. Maybe 10-15% from the lows. My view is that macro is deteriorating fast so high odds we make lower lows for a third bear market leg, mean while ill just keep moving where the price and volume action looks enticing in a very defensive way.
Overall exposure after this buy: 7%
Buy point: 38.60
Stop: 35.85
R: 7.12%
Avg Cost: 38.69 (Black solid line) (First buys-->500 USDs Risk, Full Defensive)
The thrust of buying after the buy point crossing was so brutal I even got a price that was not registered on the Trading View Platform at the time. This reinforces the strategy of buying on lots after the alerts and then asses more buying further on. It squatted right away so i could buy the rest of my position when the price returned to the pivot.
LRN going PARABOLIC FOR $19 per share return FA and TA for LRN are excellent. Parents are going to do more homeschooling secondary to Covid and the poor quality that public education provides. 10 month uptrend being squeezed into tight wedge for parabolic move.
0029 LRN:xnys - Dip Strategy | StockDate : Wednesday 20th October 2021
Time of trade (Malaysia Time) : 23:25
Scanner : DDNK Bullish Finviz
Entry Price : $36.65
Shares : 135
TP (Take Profit) : $40.39
SL (Stop Loss) : $34.87
*Prices are in $USD
Comments :
- What's on your mind? (What do you think about what you are doing/did?)
Marubozu uptrend, dip strategy. Looking to sell within 5 days or even more.
- How are you feeling? (e.g. Energetic and well. Energetic and serabut? Unpleasant and uneasy? FeelsOkayMan etc...)
Good. A chart is a chart is a chart.
- Any distractions on your mind? (Lawan ngan gf monkaS).
Nope.
Breakout in LRNStride (LRN) is an early-stage turnaround opportunity setting up in a textbook consolidation pattern.
Pullbacks have shrank from 28% to 9% as volatility compressed into a tradeable window. There was clearly heavy supply at the $36 mark, but it appears buyers have now worked their way through it, creating a "line least resistance" as Jesse Livermore would say at that level.
LRN should now be free to move higher, and even a slight increase in demand will likely have cause a significant rise in price.
I shared this idea last week and wanted to update the trade idea now that it has hit my entry trigger.
I am working a stop below last week's range at 32.60.
LRN Breakout TradeLRN is setting up in a textbook breakout pattern. Sales up huge with gains of 44%, 46%, 52% and 48% in each of the last four quarters respectively.
Notice the pullbacks getting shallower from left to right. This is a sign that profit-taking is drying up and fewer shares are being offered as the stock trades from weak hands to strong ones.
The volume contractions in the tighter range confirms this further.
Monday's selloff likely shook out the last wave of weak-handed holders which will only strenghten this setup.
Consider buying new highs above 35.96 with a stop below the most recent swing low.
Weekly Breakout potentialLooking for Breakout above this level and get into weekly Supply, longer term Swing idea.
LRN in a possible megaphone?I have been in LRN for slightly less than 1 year. Has been in what looks like a solid megaphone uptrend recently. With tech suffering I'm not exactly sure how things will go moving forward. Any ideas?
LRN ProjectionLRN has recently entered golden cross ( SMA 50 crossed above SMA 200), RSI is at a good range of around 45 and the decreasing relative change in MACD is a good indication that the momentum is building and is getting ready for a break out.
Considering all of these and based on time projection, NYSE:LRN has the potential to reach 34$ around June 11 2021.
Is LRN Heading for a Golden Cross?I've been looking for solid, well-positioned value companies to park some capital in while the current market craziness subsides. Not many out there, that's for sure. But this may be one. Let me know what you think!
LRN looks like it's headed for its golden cross on decent volume. It will probably touch its 50-D EMA again, which might be a good entry point. It's a $1.5B company with a P/E ratio under 30 (hard to find these days), a P/B of 1.89, and assets well outweighing its debt. It seems positioned to do well in the long term despite the obvious near-term fluctuations that will occur as it starts to test its 50-D EMA for support.
I'm new to this. This is not trading advice. Please don't listen to me.
$LRN - C&H pattern ...breakout pendingweekly price revision upward should see huge move in coming months.
$LRN - Did not budge on one the toughest of the daysI like this name for reversal from here. Set stop loss below 23 and forget about it for 6 months.
Bullish Stride (LRN) is ready to go upSee Chart
Fundamentally learning platforms have high potential (Boxlight, Meten)
My LRN Price AnalysisThe price has been in a downfall ever since hitting all time highs during the pandemic but as of recently the price has shown a confirmation of an ascending reversal.
Bullish signals for LRNFundamental analysis:
A learning platform with high potential for the future. The corona crisis has left considerable traces in daily education, which will continue till after the summer. Learning platforms like LRN (Stride) will benefit to the maximum.
Technical analysis:
1. Trend breakout (see picture)
2. A solid foundation for a potential break-ut
3. This stock can increase to 50 (200%)
LRN - Take advantageLong term support on 200 SMA WEEKLY chart, and double bottom on daily off this 200 sma Weekly.
Target #1: $30
Target #2: $50
Obviously there is covid in play and others that are taking advantage of this company during this time. Long term results should show this on the chart.
