Ongoing fight against coronavirus likely to increase focus on online education stocks

Summary

• There would be an increased focus on the online education companies as the UK continues its fight against the coronavirus.
• Ofqual did not bring any major changes to the latest discussions of its consultation launched in July 2020 on evaluation of the GCSEs and A-levels exam 2021.

The outbreak of the coronavirus pandemic and lockdown has led to significant interruption in the teaching schedule and methods. However, online education came to the rescue of the education sector at large by continuing both teaching and learning. There is a fear that the students could face persistent roadblocks over the course of the next academic year amid the uncertain situation that could unfold in the country’s ongoing fight against coronavirus. There are reports of recent spike in the infections, which may lead the government to impose lockdown, even if they are localised, to check any further spread of the Covid-19 illness. Given such situations, several experts believe that students will be left with no other option but to continue with their studies on online platforms.

Online education companies to benefit

It is to be noted that the UK government has announced to open schools from September 2020 but the recent spike in cases could result in an uncertain situation. And, the schools will have to continue providing online classes. Many health experts have reiterated that the infectious virus could remain for at least couple of years at least till the time everyone is successfully vaccinated.

According to UNESCO approximately 1 billion students have not been going to schools, colleges, and universities, affecting over 70 per cent of the world’s population. These numbers strengthen the case for companies dealing in online education. Such companies are known to be the game changers as they offer curriculum-based study materials, instruction videos, online seminars, graphics and pictures, beside provision for online tests and assessments. Several experts believe that the segment that had shown considerable growth in pre-pandemic times is destined to add to its growth and bring in more need-based innovation. Amid such scenario, it is important to keep a close eye on some of the stocks that have been in news recently or have the infrastructure to grow in coming times. Below we look at the stock performance of a leading company that provides online education.

Wey Education Plc: (LON:WEY) The AIM listed company uses state of the art digital technology to provide its services. Wey Education has two divisions including InterHigh (a non-selective fee paying online secondary school) and Academy21, a B2B division that serves other educational providers, schools, local authorities, and public bodies. On 4 August 2020, at 11.49 AM, the company’s stock was trading at £23.00. It remained unchanged from its previous day’s close. The 52 week low high range was recorded as 8.90 and 30.00. With a market capitalization (Mcap) of £31.85 million, the stock provided a positive return on price, which was 61.40 per cent on a year to date (YTD) basis.

Also Read: Wey Education Plc expects substantially higher turnover for the year to 31 August 2020

Even though one can’t rule out the benefits of classroom teaching and learning including the social experience, direct contact, sports, and cultural events that provide a comprehensive learning module. But at the same time, it can’t be denied that the online education sector has brought in innovation to serve the need of continuing learning in a crisis time.

Ofqual’s announcement regarding GCSEs and A-levels exam 2021

In a recent announcement, the Office of Qualifications and Examinations Regulation (Ofqual), made public the deliberations of its consultation launched in July 2020 on evaluation of the GCSEs and A-levels exam 2021 to its earlier recommendations. Regardless of an extensive objection raised by some teaching unions to earlier proposals, the Ofqual informed that the content remains more or less similar. Given the students were restricted to attend classes due to the coronavirus pandemic for several months; several school unions have found the Ofqual’s discussion insufficient and expressed dissatisfaction.

Ofqual is yet to take a decision on delaying the 2021 summer exams and proposed to commence it after the half-term break or from 7 June 2021. Need for more teaching time becomes important given the disturbance caused by the pandemic as well as the uncertain situation that could build up in future during the ongoing fight against the highly infectious respiratory illness.

Ofqual or the exam watchdog informed that it was still working with the government and the exam boards to come to a conclusion on the best approach. Presenting that there was a general support for postponing the exam dates to facilitate more teaching time, it stated that the respondents were reluctant to it in case it leads to a possible delay in declaring the results of the exams.

Also Read: Boris Johnson vows £2BN to rebuild the collapsing Education Institutions

Views presented by some of the unions

The National Education Union commented that the government should recognise the issues that concern the students and requested to decrease the curriculum content for other subjects as well. Citing the Ofqual’s recommendations as insufficient, the union cautioned that unrealistic content will bring results accordingly. Given the ongoing coronavirus crisis, the results will be a direct reflection of the student’s access to learning and grasping the topics.

The Association of School and College Leaders pointed out that the plans presented by Ofqual for the 2021 exams are just experimental in nature. The National Association of Head Teachers (NAHT), said the watchdog has delayed its proposals and has not presented any concrete measures. The changes offered by the regulator lacks the foundations to maintain the general well being and support the student’s mental health.

Conclusion

It was the online education companies that provided a much-needed support to the students while the schools remained closed for months to curb the spread of coronavirus. Though the government has announced to open the schools in September 2020 but the recent spike in Covid-19 infections could act as a deterrent and students would be forced to continue with their online classes, providing a significant dose of boost to such companies. These companies need to bring in more innovation and technological infrastructure to suit the present needs of learning as well as keep partnering in the learning process in future as well when studies begin in the classroom.