Citi downgrades Stride to Neutral amid heightened uncertainty

Citi analyst Thomas Singlehurst downgraded Stride to Neutral from Buy with a price target of $90, up from $77. The firm continues to like the long-term fundamentals for Virtual Schools and within this market and thinks Stride is well placed, The group has, however, performed well operationally, and as it happens, Citi thinks the market is too conservative on the medium-term outlook. The elevated near-term multiple vs. edtech peers and the heightened uncertainty between the full year and the setting of full year guidance at the Q1, however, drives the rating downgrade to Neutral.