Five online education stocks to watch as Delta cloud hangs thick

Highlights

  • Chegg, Inc. (NYSE: CHGG) has a market cap of US$10.89 billion. The stock fell 16.46% YTD.
  • Stride, Inc. (NYSE: LRN) focuses on K-12 education. The stock gave around 58.41% return YTD.
  • Grand Canyon Education, Inc. (NASDAQ: LOPE) offers undergraduate and postgraduate degrees. The stock has a P/E ratio of 15.38.

Education isn’t the number one sector for stock traders, but the segment has some well-known names. Of late, education companies have embraced technology to reach out to students and make learning a joyous experience. In the last calendar year, technology-based stocks grew faster than others. Today, we discuss five education stocks and see their YoY financial performance.

Chegg, Inc. (NYSE: CHGG)

The Santa Clara, California-based Chegg provides online tutoring, course assistance, and textbook rentals. The company plans to provide valuable solutions and deep student engagement as it further scales up the organization. 

For the June quarter of 2021, its revenue and net income were US$198.48 million and US$32.76 million, respectively. The revenue and net income for the previous year’s June quarter were US$153 million and US$10.59 million sequentially. The company has a market cap of US$10.89 billion.

The stock fell 16.46% YTD. Its closing price on Sep 13 was US$77.00. Its total free float shares are 142.27 million, and the 90-day average share volume is 1,246,261.00.

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2U, Inc. (NASDAQ: TWOU)

The Lanham, Maryland-based company provides courses through its cloud-based SaaS solutions. It provides services to nonprofit colleges and universities. Its offerings include short courses, undergraduate and graduate degrees, and professional certificates.

The company earned revenue of US$237 million in the June quarter of 2021 against US$182.69 million in the same quarter the previous year. The net loss incurred was US$21.8 million compared to the net loss of US$66.17 million for the June quarter of the previous year.

Its market cap is US$2.5 billion, and the stock closed at US$34.09 on Sep 13. It fell 15.92% YTD.

The total float share is 72.90 million, and the 90-day average share volume is 1,047,960.00.

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Stride, Inc. (NYSE: LRN)

Founded in 2000, Stride Inc offers alternative programs to traditional on-campus schooling with its online and offline presence. It is based in Herndon, Virginia. The company’s focus is on K-12 education, and it also runs state-sponsored virtual charter schools in the US.

On Tuesday, it announced Stride National Photography Competition, starting on September 13, for children from kindergarten to 12th grade.

Its FY 2021 ended on June 30. The revenue for FY 2021 was US$1.5 billion against US$1.04 billion in FY 2020. The net income attributable to common shareholders for FY 2021 & FY 2020 were US$71.45 million and 24.5 million, respectively.

Its market capitalization is US$1.4 billion, and its P/E ratio is 19.58. The stock closed at US$33.29 on Sep 13, and it gave around 58.41% return YTD. The free float shares are 39.71 million, and the 90-day average share volume is 530,452.00.

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Grand Canyon Education, Inc. (NASDAQ: LOPE)  

The LOPE is a non-profit education company headquartered in Phoenix, Arizona. It offers undergraduate and postgraduate degrees in various streams, including health, nursing, liberal arts, business, education etc.

The revenue and net income for the June quarter of 2021 were US$201.49 million and US$49.46 million, respectively. The revenue and net income were US$185.77 million and US$47.01 million in the June quarter a year ago.

The company has a market capitalization of US$3.99 billion and a P/E ratio of 15.38. The stock closed at US$87.63 on Sep 13. It fell 5.97% YTD.

The free float shares are 44.55 million, and the average share volume for 90 days is 290,534.00.

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Lincoln Educational Services Corporation (NASDAQ: LINC)

LINC is an education company based in West Orange, New Jersey. It provides diversified career-oriented post-secondary education to students and working people. Its revenue segments consist of transportation and skilled trades, healthcare and other professions, and business.

For the June quarter of 2021, its earned revenue of US$80.46 million and net income of US$2.43 million. The revenue and net income were US$62.47 million and US$783 million, respectively.

It has a market capitalization of US$166.7 million, and a P/E ratio of 3.61. The stock price was US$6.12 at the closing of Sep 13, and it fell 4.92% YTD.

The free float shares are 24.36 million and the 90-day average share volume is 110,842.00.

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Bottomline

The S&P 1500 Education Service Sub-Industry Index fell 4.56% YTD. The education sector is paramount for our development, yet financial emergencies, natural calamities, and health crises like the Covid-19 pandemic can adversely impact the sector. However, the technology-driven education stocks have seen notable growth during the lockdown as campuses remained shut. However, investors must evaluate the companies carefully before making an investment decision.

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